As one of Australia’s largest cities, Sydney is an attractive investment prospect for residential property investors looking to diversify and boost their portfolios. However, with economists warning that house prices could fall by up to 25% in Sydney in 2019, it’s vital that investors choose their target properties wisely.
In past years, the Federal Budget’s focus has been on improving housing affordability but 2018 saw the biggest drop in house prices since 2015, it appears the government have slowed down their pursuit.
Property prices are growing faster than your wages which means that every month you put money aside for a deposit, the market is moving further out of reach.
Millennials from modest families have been brought up with the attitude of keep your head down, work hard, save up and buy your own home first. Unfortunately, in today’s world, where property prices are rapidly growing, that’s no longer an easy option.
‘Rentvesting’ is a shift away from the traditional idea of owning your home with the white, picket fence on the quarter acre block. Society is changing, how we live is changing, so it’s not surprising the way we get ahead through property is changing too.
Did you know?
70% of Australian retirees rely on Government subsidies or are living below the poverty line.
I know I do not want to be part of this statistic, living on less than $300 per week (the Australian Aged Pension per couple).
So… what is the solution?
There were reports last night that the Sydney property market is starting to slow down as we finish another weekend that resulted in lower clearance rates with the average of around 70% instead of 80%. There were also reports from auctioneers and real estate professionals that bidders seemed less bullish.
A housing bubble is a period of rapid growth in property prices, followed by a drop in prices back to the original point. For example if the market started at $300 000 and inflated rapidly and unexpectedly to $600 000, then fell over time to the $300 000 mark or below, this cycle could be termed a ‘Housing Bubble’.