Build your nest & invest.
Rents on the rise, decreasing affordability, long term capital growth, and current excellent buying opportunities. What do those combined factors point to? They clearly point to a property market look set to smile favourably on investors, both in the short and long term.
Let’s take a closer look:
With a somewhat subdued property market currently being seen in some areas and, generally speaking, with a good supply of properties to choose from, investors can not only cash in on some very good buying opportunities, they might well be in a position to negotiate a better price in many cases.
While investors should be clear about whether they’re investing primarily for short term returns or long term growth, the current market presents opportunities for both. Continued population growth and affordability see increasing numbers seeking to rent, so demand looks to remain strong well into the future. In terms of capital growth, property values generally double every seven to ten years – which also means that the sooner one buys, the better.
Rental income is expected to remain strong. RP Data reports a 4.6% increase in rents in the six months to March 2011. Upward pressure on rents is occurring in most capital cities, with Darwin and Hobart recording the highest rental yields at 5.4% for houses, with Darwin investors achieving a return of 5.7% for units.