A property with a high occupancy rate can be said to be an excellent property for real estate investment.However, in order to maintain a stable occupancy rate, the location of the property is an essential factor.
On the other hand, if it is a popular area, the occupancy rate can be maintained even if the grade of facilities is lowered, so it is ideal to search for an area that does not require extra costs to increase profitability before purchasing. .
In this article, we will introduce the secrets of choosing a location for an investment property, which the person in charge of a real estate investment company always checks.
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What are the conditions for a favorable location in real estate investment?
The main points of good location properties checked by the person in charge of the real estate investment company are as follows.
close to the station
The shorter the time from the nearest station to the property, the better.If you do a survey of tenants, the one that is close to the nearest station will always rank high.According to a survey conducted in 2016 by CHINTAI, a major rental information site, specifically within a 10-minute walk is good. This is because there is questionnaire data that about 20% of people in their 30s and 70s want to live in a property within a 10-minute walk.
This is because the closer you are to a station, the closer you are to the downtown area, where there are many people even at night.Also, there is a difference in height from the station to the property as a point that professionals see.Even if it looks close on the map, there are actually many slopes, and it may take longer than expected to walk.
reference:CHINTAI Co., Ltd. “How many minutes walk from the station would you want to live in?”
Close to the terminal station along the popular train line
It can be said that a popular line is a line that is convenient for commuting.In other words, the lines that are directly connected to the terminal station where you can transfer to many lines such as Shinjuku, Ikebukuro, and Shibuya are particularly popular.
According to At Home's "Survey on Train Commuting by Office Workers in their 20s and 30s Living Alone and Working in Tokyo", the average commuting time is 47 minutes, and 42.5% of them are considering moving to shorten their commuting time. .
In addition, the average number of transfers is 74.9%, and it can be seen that most studio renters do not choose properties that require more than two transfers for commuting.
Surrounding facilities are substantial, there is redevelopment
If there are convenience stores, cafes, restaurants, gyms and major supermarkets, it is easy to become popular because of its high convenience.Also, if you are aiming for a family-friendly property, having a nursery school, elementary school, and a large park is a good point.
Also, if you can get information about redevelopment, it will be a great help in choosing a property.If the station is expanded and turned into a station building, or if a new facility is built due to the establishment of a university department, the value of the property can be expected to increase.
In order to check such redevelopment information, the following sites that summarize redevelopment information are effective.
reference:city repo
In addition, the person in charge of the real estate company has a diverse information network through daily interactions and obtains useful information on a daily basis, so we recommend that you visit the real estate company and ask directly Masu.
Good security and few problems
No one wants to live in an unsafe area.If there are conspicuous sex shops, pachinko parlors, abandoned buildings, etc. near the property, it may be possible to avoid noise troubles and troubles with unruly residents.Properties in such an environment will have no choice but to lower the rent, and lowering the rent will lead to a vicious cycle of increasing the number of poor quality residents.Also, you should avoid choosing such areas and properties from the beginning.
Low disaster risk
Japan is also known as a country with many disasters.Real estate cannot be evacuated, so it is directly affected by disasters such as earthquakes, typhoons, and floods.
You can check the following information on the hazard map of the Ministry of Land, Infrastructure, Transport and Tourism.
You can check the following information on the hazard map of the Ministry of Land, Infrastructure, Transport and Tourism.
- Plateaus/terraces (risk of flooding during floods if the height difference with the river is small)
- Natural embankment (relatively safe against floods, but there is a risk of inundation in large-scale floods)
- Valley bottom plain (Because it is a flat land with small ups and downs, there is a risk of flooding from river overflow due to heavy rain)
- Old river channel (due to the history of being a river in the past, if the river is flooded, the drainage is poor)
Knowing not only the property but also the geography of the area will help reduce disaster risk.
reference:Ministry of Land, Infrastructure, Transport and Tourism Hazard Map Portal Site
Choosing properties in good locations leads to lower expenses and higher yields
If you can maintain a high occupancy rate, you can reduce advertising costs due to vacancies. If there is a vacancy for one month, the rent income for one month will be reduced, and there will be one month's expenses for advertising expenses, so it will be an amount that cannot be overlooked in the long run.Less spending means more profits and higher yields.If the yield improves, the evaluation of the bank will improve and the way to refinance to a lower interest rate will open.
You can see that whether or not you can get a property in a good location will have a big impact on subsequent real estate management.Some veteran investors intentionally purchase properties that no one else would buy, and then renovate them and manage them with high yields.
First of all, according to the theory of real estate investment, it is important to carefully investigate the local area with your own feet and find the most suitable property.
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At Rich Road Co., Ltd., we will consistently support all aspects of investment real estate, from complete beginners to experienced people, from a wide range of real estate selection, loan consultations, post-purchase management, and renovations.
