7 Fundamental Things to Consider When Buying a Property
Our Guide to Buying an Investment Property (#4 Will Blow Your Mind)
- Published: 3 December 2025
Thinking about purchasing your first investment property? The right decision today can set you up for years of wealth creation, but the wrong one can hold you back financially.
At Fresh Start Advisory, we believe property investing should be accessible to every Australian. With the right strategies, you can confidently grow a portfolio of five or more properties and get closer to your financial dreams.
Here are the 7 fundamental things to consider when buying a property — insights drawn from real-world investing experience and our proven strategies. And if you’d like to go even deeper, we’ve put together a free downloadable guide packed with advanced tips and detailed analysis.
1. Vacancy Rates: Will Your Property Stay Tenanted?
One of the biggest factors in rental success is vacancy rates. This figure shows the percentage of rental properties in an area that sit empty.
- Below 2% vacancy rate = strong demand, landlords have the upper hand.
- Above 3% vacancy rate = tenants have the power, rents may fall, and your property could sit empty.
2. Days on Market (DOM): How Quickly Do Properties Sell?
Days on Market (DOM) reveals how long listings stay active before selling. A falling DOM indicates rising demand and growing buyer interest.
- 70–100 days DOM = balanced market and a smart time to buy.
- Very low DOM = buyers may be overpaying due to competition.
3. Inventory Levels: Supply vs. Demand in Action
Inventory levels measure how many months of housing stock are available compared to average sales.
- 0–2.9 months = strong seller’s market (you’ll likely pay a premium).
- 5–6.9 months = balanced market (best for investors).
- 7+ months = buyer’s market (more options, less competition).
- Tip: Look for locations where inventory is gradually tightening. This signals future price and rental growth.
4. Analysing Vacancy, DOM & Inventory Together
Individually, these figures matter. But together, they tell the full story of a suburb’s future.
- Vacancy rates trending down
- DOM decreasing
- Inventory tightening
5. Building Approvals: Is Oversupply Around the Corner?
If too many new housing developments are approved in a region, supply could outstrip demand. This puts downward pressure on rents and prices.
Always check:
- Local council approvals.
- Large-scale estates or apartment projects planned.
Fresh Start Advisory helps our clients identify growth areas while avoiding regions about to be oversupplied.
6. Median Rents: A Leading Indicator of Growth
Many investors focus on rental yields — but median rents are a stronger growth signal.
If rents are rising steadily in an area, demand is outpacing supply, and property values usually follow.
Track the historical trend of median rents before committing to a purchase.
7. Mortgage Repayments vs Household Income
An area where households spend more than 30% of income on mortgage repayments is overleveraged.
This means:
- Higher risk if interest rates rise.
- Reduced resilience in economic downturns.
Bonus Fundamentals: Supply vs Demand & Internal Migration
At Fresh Start Advisory, we also look at two bonus factors:
- Supply vs Demand – A major driver of price growth, making up 33% of our decision-making model.
- Internal Migration – Australians moving between cities (for lifestyle, jobs, affordability) can spark massive growth in new hotspots.
FAQs: What to Know Before Buying a Property
It depends on the market cycle. By analysing fundamentals like DOM, vacancy rates, and supply, you can identify the right time and location to buy — and avoid costly mistakes.
A good investment location is one where the fundamentals point to future growth. Look for:
- Low vacancy rates (below 2%).
- Median rents trending upwards.
- Balanced inventory levels (around 4–6 months).
- Rising household incomes relative to mortgage repayments.
- Positive internal migration bringing more residents into the area
In Australia, most lenders require a minimum deposit of 10–20% for an investment property. However, your personal financial situation, credit score, and lending strategy can affect the exact amount.
Like any investment, property comes with risks. These include:
- Buying in an area with falling demand.
- Extended vacancy periods.
- Interest rate rises increasing repayments.
- Oversupply from new developments.
The key is to reduce these risks by researching fundamentals like vacancy rates, inventory, and median rents.
Start Your Investment Journey With Confidence
Buying your first investment property doesn’t have to be overwhelming. With the right research, strategy, and guidance, you can secure high-performing properties that set you up for long-term wealth.
At Fresh Start Advisory, we’ve walked the path ourselves. We’ve been burned by bad advice, learned the hard way, and developed strategies that now help everyday Australians build property portfolios of 5+ properties.