When you look beyond Sydney and some parts of Melbourne, you see a lot of opportunities available in 2020.
Potential investors have left the market due to lending restrictions and media negativity. This means better opportunities are available for those building their portfolio this year.
It also helps to have your finances planned and calculated early. Try using a mortgage comparison website to help work out your borrowing capacity and potential.
You will find opportunities if you are focused on the markets which have historically experienced growth after Sydney and Melbourne, some of which saw their last major growth cycle 15 to 20 years ago. Rental yields will also increase over the next few years, as less supply enters the market.
When developers are active and supply levels are high, we see fewer rent rises, although we experience capital growth. During the correction period, provided you’re in quality areas where the demand for rental properties is high, you’ll be able to charge higher rent. So, if your borrowing capacity in the restrictive lending environment doesn’t allow you to add to your portfolio, you can still take positive steps to get closer to your next property purchase. In the words of the world’s most successful investor, Warren Buffett, “Be fearful when people are greedy and greedy when people are fearful”. A perfect example is 2018’s Bitcoin craze. Everyone jumped on board to get rich quick and it has since had a massive correction and many people have lost money. Residential property, on the other hand, is a proven performer, although it takes time and patience.
To summarise, 2020 is a great time to take advantage of opportunities left behind by those too fearful to invest and also to increase your rental income.
If you enter the market now, and as the lending restrictions relax, you will be ready for renewed demand and a kick in growth. Keep emotion at the back door and do what you can, as soon as you can to reach your goals.
Visit leading Australian consumer comparison website: MakesCents.com.au for more information on Property investment and mortgage rates.