If you’re familiar with our Property Investment Reports, you will have seen the 50-odd pages of in-depth research and due diligence we conduct for each of our client property deals.

After finding a potential deal, our talented acquisitions team work 25/7 on a thorough analysis of cash flow, capital growth statistics and other factors to ensure the deal is a good investment.

A huge part of this analysis is recognising whether the deal is situated in a good investment market.

Here are the 10 market drivers we look for when identifying a great investment:

  1. Infrastructure investment: What are the planned projects in the area? What is the estimated spend of these projects?
  2. Population growth: What are the migration projections for the area?
  3. Projected rental growth: What are the rental trends in the area? Is there a growing demand for accommodation (e.g. a new education campus, factory, hospital, retail precinct et cetera)?
  4. Diversity of economy: Is the area’s growth driven by more than one or two major industries?
  5. Supply and demand: How does the number of market listings compare to this time in previous years?
  6. Vacancy rates: Is this a seasonal market? Or is occupancy strong throughout the year?
  7. Projected capital growth: Are there any indicators of suburb gentrification? Or are other markets nearby picking up, potentially causing a ripple effect?
  8. Estimated rental yields: How does this compare to other suburb yields?
  9. Affordability: Is the property affordable relative to the median income?
  10. Council planning: What does the council have planned for the area in terms of zoning et cetera?

As we go through each of these and ask the relevant questions, we tick each category if it will drive market growth.

Then, we add up the ticks and give the property a score out of 10.

And that’s it! That is the tried and true formula for identifying market drivers. Catch some of the examples of great deals our acquisitions team have sourced for clients here.

If you’re interested in looking at the kind of research we do, contact us at info@positiverealestate.co.nz and request a copy of our 2016 Hot Spots To Invest PDF.