Have you been thinking about stepping on to the property ladder and investing or perhaps you’ve been considering adding to your portfolio but not sure if it’s the right time?
Maybe you’ve been put off by the media, reading about issues of rising housing costs or that the property bubble is about to burst?
We know that people worry about these things and we’re certain there are potential investors sitting on their hands to wait and see what happens.
As with most things there is never a perfect time. But procrastination does not equal profit.
There’s Never Been A Better Time To Buy And Here’s Why:
1. Record-Low Interest Rates
Currently many of Australia’s lenders are offering interest rates below 4% as interest rates continue to hover at record lows.
So what does that mean for you and how do you benefit? Lower mortgage repayments and a more affordable cost of borrowing.
2. Vacancy Rates Are Low
Data released by SQM Research this week has revealed the national residential vacancy rate fell to 2.2% in February 2018.
A common concern we find most investors have is their worry about having their investment property empty for periods of time. And, judging by this data, you shouldn’t have too much trouble finding an appropriate tenant.
However, no two property markets are the same and it’s important that you do your due diligence or better still, work with a property expert who can guide you and ensure you don’t make the common mistakes most investors do.
3. There Is Less Competition Amongst Investors
In the past, foreign investment has driven up prices. With recent changes, sales in new developments are capped at 50% to foreign investors – and investors are only permitted to purchase new build properties if they are a permanent resident of Australia.
It’s worth noting also that penalties may apply to foreign buyers if they leave their investment properties vacant. Potentially, this could leave the market open to opportunity, particularly for those prepared to invest in established homes.
4. National Rents Are On The Rise
According to the latest CoreLogic Rental Report rental rates are on the rise. In the December quarter, all capital cities except Canberra experienced a higher annual increase in rents over the past year, compared to the same period for 2016. The same was true for regional markets. If the rent covers the expenses and generates cash-flow, this puts you in a positive position to hold the property.
5. Save You Thousands Of Dollars In Tax
The ‘negative gearing’ tax laws allow you to offset any shortfall between the rent that you collect from your investment property and the expenses that you pay for against your other assessable income.
As you can see, there are some great reasons why now is a good time to be a property investor (or continue your journey). Drivers such as gentrification, population growth in an area where there is limited supply and major infrastructure changes all bring increased prices. When buying a property it’s always advisable to invest in areas where there are multiple growth drivers that will ensure continued long term capital growth.
If you are considering dipping your toe and would like to discuss strategy, feel free to contact our office. We’d love to chat through any concerns or questions you have. Phone 08 6323 2306 or email info@curtispropertygroup.mysit3.com
