Australian Property News
Investors back in the market
Posted on Friday, June 19 2009 at 3:37 PM
Attractive yields, low interest rates and the ability to earn a positive return are luring investors back into the property market, according to the Real Estate Institute of Australia.
Institute president David Airey says first homebuyers have dominated the market for the past nine months largely due to the grants on offer, but there's increasing evidence investors are back.
The seasonally adjusted value of finance commitments for investment housing increased for the second consecutive month in April, according to Australian Bureau of Statistics data.
The rise was due to investment in existing housing, with investment in new dwellings declining.
"This is the first time investment in housing has increased for two consecutive months since mid 2007," says Airey.
"Investors are returning to the market because of strong rental returns creating positive gearing and excellent capital growth prospects."
Airey says based on median house prices and rents, investors can expect a positive return - based on a 25 per cent deposit and using an interest-only loan - in six of the eight capital cities.
"History shows that fortune favours the brave and astute investors may see this as a great opportunity to invest in quality property with great long-term growth prospects."
Follow us on Twitter.
Was this article helpful? Place a link to it from your website, or share it using the button below.
Recent articles:
Units might need TV signal distribution system upgrade
Undersupply not the only obstacle
Dwelling quality takes priority over quantity
RBA official identifies housing shortage as key challenge
Home lending drops
Fixed rate loans gain market share
