A practical checklist: what to look for before committing to a property investment

Even in a strong location, not every deal is a good deal.

Two properties on the same street can perform very differently depending on price, structure, costs, and assumptions. This checklist focuses on the investment itself, rather than the wider area, and is designed to help investors pressure-test a deal before committing.

You don’t need every box ticked, but if several are missing, it’s usually a sign to slow down and reassess.

Property investment checklist

Purchase price

☐ Is the price realistic compared to recent comparable sales?
☐ Are you paying a premium, and if so, can you justify why?
☐ Does the price already assume future growth?

Paying tomorrow’s price today removes margin for error.

Rental income assumptions

☐ Is the projected rent supported by real local listings, not estimates?
☐ Have you assumed conservative occupancy or void periods?
☐ Would the property still work if rent growth slowed?

Income should be based on evidence, not optimism.

Running costs

☐ Have you factored in service charges, ground rent, and management fees?
☐ Are maintenance and repair costs realistic for the property type?
☐ Have you allowed for future cost increases?

Underestimating costs is one of the most common investment mistakes.

Mortgage and financing

☐ Does the rent comfortably meet lender affordability requirements?
☐ Have you stress-tested repayments at higher interest rates?
☐ Are you relying on refinancing assumptions to make the deal work?

If the deal only works with perfect financing conditions, it’s fragile.

Yield quality

☐ Are you looking at net yield rather than headline yield?
☐ Does the yield reflect actual cash flow after costs?
☐ Is the yield sustainable, not front-loaded or incentive-driven?

High yield on paper does not always translate into real income.

Capital growth rationale

☐ Is there a clear reason this property should grow in value?
☐ Are growth assumptions based on fundamentals, not speculation?
☐ Would you still be comfortable owning it if growth slowed?

Growth should be a bonus, not the only justification.

Tenant appeal

☐ Is the property suitable for a broad tenant market?
☐ Does the layout, size, and finish align with local demand?
☐ Are you relying on a niche tenant profile?

The broader the appeal, the lower the risk.

Management intensity

☐ Does this investment suit your level of involvement?
☐ Are you prepared for tenant queries, voids, and compliance?
☐ Is professional management factored into the numbers?

A good investment should match your time and stress tolerance.

Exit strategy

☐ Who would buy this property from you in the future?
☐ Is there owner-occupier demand as well as investor demand?
☐ Are similar properties selling easily?

Liquidity matters, especially if circumstances change.

Risk concentration

☐ Does this investment overly concentrate your capital?
☐ Would a problem with this one property cause pressure elsewhere?
☐ Are you diversifying gradually rather than overcommitting?

Early investments should reduce stress, not increase it.

Incentives and pressure

☐ Are incentives masking the true price or performance?
☐ Are you being rushed to commit?
☐ Would the deal still appeal without urgency?

Good investments rarely need to be rushed.

Emotional check

☐ Are you buying because it makes sense, not because of fear of missing out?
☐ Would you still be happy with this deal in five years?
☐ Have you stepped away and reviewed it calmly?

Emotional decisions tend to be expensive ones.

How to use this checklist properly

This checklist isn’t designed to talk you out of investing. It’s designed to help you invest well.

If a deal ticks most of these boxes, it’s usually worth moving forward to deeper due diligence. If it relies heavily on assumptions, incentives, or urgency, it’s often better to pause.

Experienced investors run through a similar process instinctively. Writing it down simply makes decision-making more disciplined and repeatable.

Getting a second opinion

Sometimes the hardest part of investing is knowing whether your concerns are valid or just nerves.

At Advantage Investment, we regularly help investors pressure-test opportunities before committing. A good investment should still make sense when the excitement is stripped away.

Taking a little more time at this stage often saves years of frustration later.