Home > News & Insights > What other property investors are thinking
Jul 30, 2022 |GODFREY DINH
Annual inflation rose to 6.1%, the latest inflation figures released on Wednesday showed. It all but confirms another cash rate hike next week, and reinforces the importance of long-term property investing.
Now is a good time to lean on insights to guide your decision-making.
In this newsletter, we’ll tell you what’s on the minds of other Australian property investors, investment locations they’re eyeing and the strategies they’re using to build wealth.
Why not invest now?
Where to invest?
What to invest in?
How to invest?
When to review financing?
How to manage?
If you look at the wide affordability gaps between the capitals, it makes sense why 40% of investors chose Perth as their preferred city to invest.
Nationally, mortgage repayments account for 37.3% of the family income.
In NSW, 46.5% of a household’s income goes towards servicing average home loan repayments, according to REIA data. In Victoria, the proportion required is 38%. Both are higher than the national average.
Compare that with Perth, where only 26.6% is needed.
Reviewing your overall financing strategy and investment loans regularly can help save you money in the long run. Given the rising rate environment we’re in, it’s especially important to keep your finger on the pulse of the loan market.
Staying on top of your loans can help by ensuring that:
For example, if you - like 39% of participants - are on your journey to expand your portfolio, making interest-only repayments is one option to help you free up cash flow.
However, if you - like 22% of participants - are seeking to consolidate your portfolio, it may not be a good idea to fix your rate, as this could mean expensive break fees when you decide to sell.
Most property investors aren’t getting advice from their property managers on recommended value-adding opportunities. This means many investors may not be maximising the full potential of their investment.
Sometimes, even minor improvements in a strong rental market can lead to an increase in rents. It’s something that’s even more crucial for investors to consider, given rising rents amid an easing property market.
23% are being held back by either factors relating to the economy or property market. These short-term factors are less relevant if you plan to hold investments over the long term. History has shown us that while short term fluctuations may seem critical at the time, their impacts are less significant over many years.
Overall, the rate of decline recorded across the capital cities over June 2022 for both houses (-0.9%) and units (-0.5%) accelerated at twice the rate of the month prior (-0.4% and -0.2% respectively).
Adelaide property prices showed the strongest overall growth in June of 1.3%. It has been the only capital city seeing a monthly growth rate of above 1.0% since May.
Sydney prices fell the hardest among the capital cities for both houses and units, though it is still recording annual growth across both property types.
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