Property Investment Checklist
Key things to check before buying an investment property, from yield to cash flow to location.
1. Know Your Numbers Before You Look
Before you start inspecting properties, understand your borrowing capacity and how much deposit and buying costs (stamp duty, legal fees, inspections) you'll need. Our Borrowing Power Calculator and Stamp Duty Calculator are a good starting point.
2. Rental Yield and Cash Flow
Gross rental yield (annual rent divided by purchase price) gives a quick comparison between properties, but net yield — after rates, insurance, property management fees, maintenance and other holding costs — tells you more about actual cash flow. A property with a high purchase price and strong capital growth potential may still have a lower yield than a cheaper property elsewhere, so weigh both together against your goals. Try our Rental Yield Calculator to compare properties.
3. Location Fundamentals
- Proximity to transport, schools, shops and employment hubs
- Vacancy rates and typical time-on-market for rentals in the area
- Planned infrastructure or development that could affect future demand
- Owner-occupier versus renter mix, which can affect capital growth and tenant demand
4. Property-Specific Checks
- Building and pest inspection reports
- Age and condition of the roof, plumbing and electrical systems
- Body corporate fees and any special levies, for units and townhouses
- Land tax implications, particularly if you hold multiple properties
5. Financing Structure
How you structure your loan — including whether you use an offset account, fix or vary the rate, or use equity from an existing property — can materially affect your returns and flexibility. This is worth discussing with a broker before you commit, not after.
6. Ongoing Management
Decide early whether you'll self-manage or use a property manager. Professional management typically costs a percentage of rental income but can save significant time and reduce risk around tenant selection, compliance and maintenance — see our Property Management service for what this involves.
7. Think Beyond the First Purchase
If building a portfolio is the goal, consider how each purchase affects your borrowing capacity for the next one, and whether the property type and structure fit your long-term strategy rather than just the immediate deal.
General information only. This guide is general in nature and does not take into account your personal objectives, financial situation or needs. Property investment carries risk, including the risk of loss. We recommend seeking independent financial, legal and taxation advice before making an investment decision. See our Legal Disclosures for further information.