Where To Invest In 2019?
Let's face it, Australian’s love investing in property. We always have, and we always will, but there comes a point where simply having just a love for it, isn’t enough. You have to actually be able to borrow the money to invest otherwise your plans could come to a screaming halt.
Affordability in 2019 is going to be without a doubt a key driver in price growth along with the ability for investors to be able to borrow money. With the royal commission currently in the spotlight, many banks have been more conservative when assessing finance applications. If across the board, the capacity for investors to borrow investors capacity has been reduced, this in turn with effect property prices. If someone could borrow $600,000 previously, but now they can only borrow $400,000, logic says that it will affect higher-end properties because there will be fewer buyers around at this price point. So how can you best navigate 2019 and position yourself for success as an investor?
Look to continue your property journey by thinking outside of the box. Broaden your knowledge and awareness of different markets across Australia. If affordability and lending are going to be two major factors that affect price growth moving forward, you need to keep this in mind and buy in areas that are just at the beginning of their growth cycle, within the affordability belt.
Additionally, lower-end properties generally offer a higher rental yield which will also be looked upon more favourably by the banks.
So, where should you invest in 2019?
Without jumping into writing an article similar to the movie “Back to the future”, can you picture what Australia will look like 10 years from now?
Not only is immigration continuing to rise which will keep up the demand for quality housing, but the way we live is also changing. In 10 years time, there is a fair chance there will be a bullet train connecting major regional hubs with our capital cities. What would take you 2 hours in today’s commute time, will take you 30 minutes on a bullet train. Therefore more and more people will be looking to live in well established regional hubs and smaller cities where they can have a better lifestyle, live in a nicer house, at half the price of those in our cities,.
You’re probably asking the question, ""But well where are they going to work?""
More and more Australians are now working remotely, from home, from coffee shops, doing their meeting’s via skype or zoom. Many are dialling in once a week on a conference call or working out of their cars. I know if I was asked the question, ""If you could live in a nicer house, pay half the amount, have a better lifestyle but get to a city with 30 minutes would you do it?"" My answer would be yes and I’m sure many Aussies would too.
So which areas do we think are going to have a growing surge in population? We are very bullish with a number of hubs and cities such as Devonport and Launceston in Tasmania, Ballarat, Ararat and Bendigo in Victoria to name a few. When you have a surge in population, the demand for housing rises, which can make it a great place to invest, particularly if you're getting in at the beginning of the growth cycle.
In addition, which major capital cities do we see performing well? The number one choice for us, is Adelaide. Many of the growth drivers indicate that Adelaide will have a solid year in 2019 and beyond. It is currently the cheapest capital city in Australia which is hard to believe for many. Economic conditions have drastically improved in Adelaide with numerous investment and projects approved and kicking off in the state, making it exciting times ahead.
If you're looking to invest in 2019, without a doubt there are many exciting and emerging markets that will provide ample opportunity for the educated and prepared investor.