Search

There has never been a better time to buy a property


Historic low interest rates, rising rents and tight vacancy rates mean the time has never been better to buy property.


The cost of borrowing money to buy was half what it was at the same time last year, according to James Fitzgerald Managing Director of property investment group Custodian.


And with the Reserve Bank of Australia signalling that it does not intend to increase interest rates again until 2024 at the earliesti it’s also an ideal time to invest.


“Since the COVID pandemic started interest rates have dropped from 4.5 per cent to less than 2 per cent. That means the cost of borrowing money to buy a home is now half of what it was at the beginning of 2020,” Mr Fitzgerald said.


“Financial conditions like this don’t emerge all the time, that’s why anyone looking to build a property portfolio should be seriously investigating that now.


“It’s a once-in-a-lifetime opportunity. One of the biggest concerns property investors have is cash flow, that’s why only 10% own more than one, but with rents rising and vacancy rates dropping the stars are aligning for buyers.”


Aside from inner city unit markets in Sydney and Melbourne vacancy rates for houses are low and demand is high.


“Adelaide, Perth and Hobart all have vacancy rates below 1 per cent and Brisbane is just 1.8 per centii,” Mr Fitzgerald said.


“A vacancy rate of 3 per cent is considered balanced and anything below that is tight. Rents are also going up in these cities, by 11.7 per cent in Perth in the past 12 months, 4.1 per cent in Adelaide and 3.4 per cent in Brisbane.


“Even Sydney and Melbourne rents where the market is affected by a lack of international students and overseas migrants have increased 2.1 per cent and 0.8 per cent respectively during the same period.iii ”


Mr Fitzgerald said it was the perfect time for first home buyers to become first time investors and take advantage of the massive government financial incentives, which in some states was worth up to $50,000, particularly for those building.


“It means you may have to live in the home for a year, but that’s a small price to pay to receive such a big financial windfall just for buying a property,” Mr Fitzgerald said.


“If you pool together the various State Government and Federal Government concessions first time buyers and take into account the reduced stamp duty, the savings can be enormous.


Media contact: Michelle Hele, Sequel PR – 0411 112 114


..................................................................................................................................................................................

i https://www.rba.gov.au/publications/smp/2021/feb/pdf/statement-on-monetary-policy-2021-02.pdf

ii https://sqmresearch.com.au/graph_vacancy.php?national=1&t=1

iii https://www.corelogic.com.au/sites/default/files/2021-02/CoreLogic_home_value_index_Feb_2021_1_1.pd



2 views0 comments