If you are looking at buying an investment property as part of your new year resolutions, now could be the best time to look at mining towns.
An article on the Aussie blog says that:
Mining towns across Australia are the big movers in the rental property market, with regions such as Illawarra and the Hunter Valley in NSW seeing sharp increases of around nine per cent in weekly rents over the past year.
Of course rental returns are a critical element when assessing the viability of an investment property purchase but there are a lot of other factors too.
“Location, location, location” is the catch cry used by property spruikers and this is nowhere more important than in the investment property market. The same Aussie blog reminds us that buying in a flood zone can be made more difficult because it is nearly impossible to work out exactly what the house is worth. Worse still how do you determine the likely future value increases which are imperative when putting a wealth creation strategy in place.
But the fact remains that vacancy rates are low and rental values are soaring. In fact the Advisor says:
“With regard to rents, 2011 has been a landlords’ market with rents nationwide recording rises of 4.6 per cent-plus, according to the Australian Bureau of Statistics (ABS),” managing director of SQM Research, Louis Christopher, said.
So, when looking at buying an investment property, remember this.
Get advice from the experts and that doesn’t just mean your local Real Estate agent (who is keen to sell you anything on their books). Instead read the investment property market news and gather as much intelligence as you can. For example:
While properties in Melbourne, Adelaide and Hobart are set for a modest year in terms of property price growth, other parts of the country are likely to enjoy robust rises in home values over 2012, Australian Property Monitors (APM) senior economist Dr Andrew Wilson has claimed.
(Thanks to the Advisor for this snippet)
Compare that to this:
Continued economic uncertainty could cause house prices to fall by as much as 5 per cent in the first six months of 2012.
According to AMP’s chief economist Shane Oliver, the Reserve Bank of Australia will be forced to cut rates at least twice more in a bid to stimulate buyer confidence.
(Again thanks to the Advisor.)
Is there an easy way to select an investment property?
OK, so it might get a bit confusing and when it comes to any type of investment, there are always risks. That’s why it’s so important to get as much information as possible and not to take the word of anyone with a vested interest.
At the end of the day the final decision rests with you, but if you want to discuss the options surrounding buying an investment property please call me on 1300133193.
