If the most recent data from the Australian property market is anything to go by, we are heading into a property boom, and housing affordability will be impacted for both home owners in investors in the coming months. Sydney and Melbourne property prices are increasing, auctions are seeing bids far exceed the reserves as competition drives prices up in line with perceived property scarcity as the market swings around.
Why are we looking at a property boom now?
Interest rates cuts, remaining rules for negative gearing, increased buyer confidence, and a push for first home buyers entering the market have resulted in some pretty big changes in the property market. It’s becoming increasingly difficult to purchase property in capital cities, and price increases are far beyond wage increases in cities like Sydney and Melbourne.
What does this mean for Australian investors?
The result of all of the above is that investors are moving into the property market in regions outside of where they reside, such as South East Queensland where housing affordability is far less unrealistic. Brisbane, the Gold Coast, Logan, Ipswich, Toowoomba, the Sunshine Coast, and even further north towards the Bundaberg regions are seeing an influx of residents moving in due to the rising cost of living in bigger cities. With that comes demand for rental properties, as well as investment into local infrastructure.
The issue is, that while savvy investors are taking advantage of affordable purchase prices now, or they’ve already purchased their property while the market was showing the initial signs of turning, as the general public become aware of the changing trend they are more likely to take action, driving property prices up at competition grows.
If making an investment was something that you were considering, now is the time to start doing your research. Look at property price comparisons between different regions in Australia. Look at the rental demand from tenants. The population growth. Employment opportunities. Start looking at average return on investment figures, and then look for house and land packages with strong return percentages.
Maximise your returns
Setting yourself for an enjoyable retirement with multiple passive income streams is something that many of us should be considering sooner rather than later. Different types of properties will offer different returns. Work out which style of property will best meet your needs in terms of lending affordability, ongoing expenses, rental income, and as part of a long term plan for financial security. You can learn more about our model for maximising passive income from your investment property here, or you can dive right in and view our current investment property listings here.
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