Investing in property in Australia, specifically in Sydney can be quite tricky as the real estate market down under has been doing so well for the past decades.
People wonder if it’s a good idea to put their money in properties because after so much growth there has to come a bursting bubble, right?
But, with the strong economy and low base interest rates (1.5%), investing in Australia real estate may still be good move for increasing your overall wealth and financial portfolio.
Here’s why:
The Property Observer featured a recent report from UBS Wealth Management, stating that Sydney is at the risk of a “housing bubble.”
“Housing bubble risk zones” are cities in which property prices within that zone have increased by 50 per cent on average since 2011. There’s been a risk of the bubble popping since the 1970s because of the real estate boom in Australia, and it continues to overheat to this day.
What could be the possible scenarios for Sydney?
Most Sydney property investors ask this question: Will property prices go up and, if so, by how much?
A recent article by Caroline James at realestate.com.au notes that Sydney, compared to other capital cities, has been the star performer over the past five years. But will it continue to do so?
I also noticed a particularly surprising outlook for Canberra.
Phil McCarroll writes a piece for the website Your Investment Property where he talks about the tightened state of Sydney’s rental market. For the month of March, the vacancy rate has remained where it was in February. The Real Estate Institute of New South Wales’ (REINSW) Vacancy Rate Survey put the rate at 1.7% for March.
If you think we are done with the ancient transaction method called Barter, just take a look at what’s happening in Perth. Perthites are swapping beer for goods and services. Facebook’s Perth’s Beer Economy page has 56,000 members and counting. They encourage more and more people to barter beer for goods and services.
Over the last few years, Australia’s economic growth hasn’t been anything that’s worth talking about. Australian housing market, however, has made many investors very happy. A year to end-Quarter 3 2015 analysis reveals that house prices shot up by 11.4% across the eight chief capital cities of Australia. This ‘nominal’ rise can be seen as a 9.72% ‘real’ or inflation-adjusted rise.
This year to year increase, says the Australian Bureau of Statistics, (ABS) is the highest recorded since the second quarter of 2010. All, however, may not be good with Sydney real estate in particular and the Australian housing market in general. Let us dissect the residential property market and also find out that one major threat which may especially push Sydney further down a number of steps.
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