Here’s why now is a great time to invest:
1. Market confidence – after a couple of years of caution and disruption, it’s time to get back to our own plans and goals rather than waiting to see what’s going to happen next. This is evident in the property market activity, the residential auction clearance rate, the increase in sales of investment properties, the fact that demand is outweighing supply and the strong capital growth in many locations around the country – particularly those popular for sea and tree changers.
2. Forecast economic growth – the RBA states that we’re transitioning from the initial “snapback” period post Covid and are forecasting economic growth to increase from 1.5% in 2020/21 to 3.75% in 2021/22. This is a great indicator for investors and is driven by wage growth, unemployment decline, spending increasing, strong household savings, reopening of international borders and increase in international trade.
3. International borders reopening – international students and workers have a huge impact on the rental market. The reopening of borders is expected to lead to increase in rental demand, increase in rent yield and decrease in vacancy rates. In turn, this will drive property values up. The return of international travellers and immigrants will also have a positive impact on our labour market and economy.
4. Quality developments in prime rental areas – in my research I always look for strong rental demand, affordable pricing and strong forecast capital growth. Then I look for the best of the best in developments, which is why we’re always on the lookout to find the very best of the best when it comes to investment properties and we have three very exciting opportunities at the moment – from the Sunshine Coast to Newcastle to Melbourne. These are all locations that have strong rental demand, affordable pricing and strong forecast for capital growth.
The warning signs to take into consideration include:
1. the forecast increase in interest rates – which is something we always factor into our cashflow to make sure that any rate increases don’t have a large impact on your ability to hold the property.
2. delays in international borders reopening due to Omicron and other potential variants – but again, we need to focus on your own goals and investing strategy and ensure that the research supports your investment decision.
If now is the right time for you to invest, we’d love to explore your plans and discuss some great options that are currently available in high growth, high demand locations on the east coast.
Let’s make 2022 the year that you change your financial future.