Buying a property- Features vs. Benefits
If you’re looking at buying a property for either personal or investment reasons, there are two key areas you need to consider – features and benefits.
Although the two may sound similar, they are actually quite distinct and both need to be weighed up when making such a crucial financial decision.
So, what’s the difference and why do they matter? Well here’s a quick run down of features versus benefits.
In short, features are the things a property has, and there’s a good chance you’ll have a decent list of features that a prospective property needs to tick off.
Features are things like ‘two bathrooms’, ‘an outdoor entertaining area’, ‘a shed’, ‘car accommodation’ or a ‘swimming pool’.
When it comes to buying a property, some of these features will be non-negotiable for you personally. For example, if it’s a family home you’re after, three bedrooms and two bathrooms might be the minimum features you need.
If you’re investing, those features might be very different depending on the tenants you’re hoping to attract.
For example, in an inner-city area where professionals are your target tenants, a unit with features of two bedrooms, and secure parking might be the minimum pre-requisite.
On the flipside, if you’re buying an investment property in the outlying suburbs, three bedrooms and a low-maintenance yard might be some of the features you’re after.
As you set about house hunting, it’s always a good idea to have the features you want clear in your mind as this will help narrow down the search.
Benefits, on the other hand, are a totally different beast. These are the property traits that improve both its value and its appeal. In short, they make your life easier as a buyer or your tenant’s life easier as a resident.
So, being located near schools and public transport might be considered benefits depending on you or your prospective tenant’s stage of life.
Being located in the inner city could also be considered a benefit, if that’s where you work and play. But when it comes to benefits there’s more to look at than just what’s currently in existence.
Benefits can also include the property being located in a high-growth area, or a suburb where additional infrastructure is planned.
They can also extend to things like employment prospects and industry. These two would be important benefits for an investment property, for example, when it comes to securing consistent tenancies.
That means benefits are something you should investigate as part of your due diligence, looking at what’s planned for the suburb and area where a prospective property is located, who lives there now, what type of employment is available etc.
The reality is, while features are boxes to be ticked, benefits could be the ingredients of capital growth. They could be the indicator your prospective property will increase in value over time.