Market Update

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Is Your Suburb About to Witness Rise in Property Values?

property pricesSmart rental yield can help you tackle mortgage liabilities, but you will still have to depend on capital growth to ensure that you make a winning investment in real estate.  Property markets, which are about to witness an upsurge in prices, have a few inherent conditions which are common to all. So how can a layman get a better grasp of whether a particular market is going to soar or plateau in the short run?

Telltale signs of expected growth in property prices

For me there are always telltale signs, which I am sharing here for the better understanding of my readers.

Dropping average market days

As a first, you will find the average days on market falling. This is the case because the demand exceeds supply in such areas and the property investors are quick to lap up such properties. It can be logically inferred that such property locations witness low average days in the market.

Falling discount levels

Another thing which is deeply related to the phenomena “dropping market days” is the drop in discount levels. When demand exceeds supply, the image of a seller’s market forms and in such cases properties can sell off at meager or zero discounts, too.

Dropping vacancy rates

Another giveaway of an area about to witness a hike in values is plunging vacancy rates. Rental accommodations begin to fetch tenants crazily and in a short space of time, all of them get filled.

Number of online enquiries

As a notable aside, if you figure there is a great volume of online enquiries for a property location where there aren’t many properties left, you can infer that the area is about to witness a rapid growth in property values.

Underperformance

And of course, lest it be forgotten, those areas which are underperforming for a considerable period of time will be more ready than other areas to witness capital growth. Yes, there are locations which see counter-cyclic improvements that are hard to trace, but real estate busts and booms have a pattern (decipherable albeit hard to read) and this make long-term underperformers good areas for purchase. All you need to do is look for subtle hints that something apart from the usual is occurring in a particular area.