A Buyers Market…..
Subsequent interest rate rises, the US downturn in the property market and uncertainty in the longevity of the mining boom has resulted in a buyers property market across Australia. The hot Australian property market has now cooled to an autumns day and is on the verge of slipping into a cold winter. For sellers this is not great but for buyers this posses a great opportunity particularly in investment properties in capital cities.
For a long time the return on investment properties across Australia has only be 2% to 4% (excluding capital gains) which compared to the return of a bank deposit account of 5%+ it isn’t that great. The reason for this hasn’t been that rental levels in Australia are low, as these have been rising steadily for the past ten years. Rather, it is because property values in Australia have increased ridiculously over the past ten years, much greater than rental incomes.