5% Rental Yields not uncommon these days
According to the Global Real Estate Trends report 2010 (not dissimilar in 2016), Australia has the strongest housing market in the world in terms of property value growth. The trend of overseas buyers identifying this opportunity is a growing trend knowing how well the Australian economy is doing and how politically safe Australia is.
Reasons why overseas investors choose Australia include : Our strong economy; low unemployment; strong immigration figures; low supply & high demand & strong rental incomes. If it is an opportunity for offshore investors, it is a real opportunity for those living in Australia we are sure you would agree.
Although the housing market’s growth has somewhat slowed, our capital city populations are still increasing at the highest rates in the Western world – every year, 150,000 new Australian households are formed and each of them needs a home.
As affordability of buying inner city housing drops, people would rather rent where they wish to live than buy further out and have to commute. This trend plus an influx of immigrants and migrants into capital cities is placing upward pressure on available rental accommodation.
It pays to be a Property Investor : Rentals Income last year increased on average by 4.2% and RP Data predict that rents across capital cities will increase by a further 8% during 2011. When last did your boss give you an 8% increase?
Recent IMF report confirms that a collapse in the Australian property market is unlikely and the ratio of house prices to income levels has eased to below pre-global financial crisis (GFC) levels, according to the Housing Industry Association (HIA). The association says Australia’s house price to household income ratio is now at 4.1. What this means to you is that at the very least housing prices are only around 5 to 10% overheated confirming IMF report results.
If these new householders can’t afford to buy, they have to rent and this means that capital city rents are rising again. During the last twelve months, Residex figures show that median rents rose in nearly 75% of our capital suburbs, many increasing by up to 25% and some as high as 33% or more.
During the last three months, over 50% of our capital city suburbs experienced rent increases, occurring in all capital cities.
SO WHAT’S THE GOOD NEWS?
We are clearly moving into an extended period of rent increases and for investors, this heralds the return of positive gearing – when your rental income is greater than the cost of your loan, and the tenant is paying it off for you.
Not sure if you are aware of the Federal and State NRAS programme set up to assist those who cannot afford the higher rentals in suburbs that they should be living and working in. The government is asking you the investor to put your hand up and help increase the amount of rental properties in the market place. As an investor you will receive $9140 pa back as a tax credit …. read more, helping you achieve a Positively Geared Investment Property
Sit down, evaluate your financial goals where you are now and where you wish to be in the future and substantiate your own reasons for wanting to invest in property you will soon realise that other low risk investment vehicles simply cannot give you the wealth you will require to meet your goals. You do not have choice!
On wanting to investigate the investment ‘propertunities’ in the market, you will want to make use of our services of finding the ‘best fit’ property matching your requirements and investment strategy.
We represent you the investor and are not here to sell property. We undergo the research and analysis on your behalf and will provide you with a selection of properties matching your objectives from which you will make an informed decision.
We do not mind if that decision is a no or a Yes, so long as you make one based on the selection and supporting information we provide you! Is that fair?