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Land Sale: Chanel Heights Estate |
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NGRE News |
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Investment Properties in High Demand |
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The tightened rental situation in Geelong is currently experiencing its lowest vacancy rate with a reduced number of properties available. With a historically low vacancy rate (having dropped to 1.5% in Geelong)*, in addition to the reduced number of properties available, the situation has severely impacted prospective tenants seeking rental accommodation.
The current crisis with rental accommodation is attributable to a number of different factors. These factors include investors choosing stock market over property investment in recent years, levels of property and income taxation discouraging investors and also interest rates proving a disincentive for tenants to leave the rental market and become owner occupiers.
This imbalance in demand and supply of investment properties is creating havoc with people needing to relocate and has put a substantial strain on social services.
But the current high demand and low supply should also act as an incentive to investors to purchase investment properties and put them into the rental market as there is clearly a high demand and good returns.
Its predicted in the future that with stable economic conditions and a fluctuating stock market will mean investors will seek security of a bricks and mortar investment. State government incentives for first home buyers have been extended until June 2009 and an extra $2000 assistance for first home owners has been introduced for buyers that are building their first homes, which can total $12,000 in grants that the first home buyer is now eligible to receive. These available grants should help ease the pressure as it will assist families looking to leave the rental market and purchase their own home. |
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Stability a Key Reason to Invest in Property |
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Property continues to be a tangible and solid investment. During the periods of uncertainty, an investment property can provide stability.
The rent is set and generally stable so the income is fairly predictable over the life of the investment. The outcomes are also generally stable so investors should be able to forecast their spending and with the fear of rising interest rates, a fixed-term loan is a good option. Increasing the capital value of a home by painting, paving and performing continual upkeep of the home will help to increase any rental income and assist with maintenance bills at a low. The rental market is presently tight and investment properties are achieving all-time record rents. If a tenant vacates a property, the turnaround time to find another tenant is as quick as it’s ever been. Although interest rates have been rising, they’re still considered to be a reasonable level and the rising rents are helping somewhat to compensate for the rising costs.
By Joe Grgic
Published Geelong Independent 8th February 2008 |
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Property search powered by realestate.com.au |
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North Geelong Real Estate is a member of the REIV |
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Mortgage Fair |
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10 Tips For Securing Your Home While Away |
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