20 Oct The Burning Topic for October: Is property investing too hard?
About the author
Jane Slack-Smith has been named one of the Top 10 Property Experts in Australia by Money Magazine, one of the Top 4 Financial Influencers by Qantas and been awarded the Australia’s Mortgage Broker of the Year twice.
Currently, there is have record low clearance rates in Sydney and Melbourne, negative gearing and capital gains tax proposed changes, landlords rights are diminishing, banks are putting up rates – why is property investing so hard?
Now I have to contrast that to a conversation I had with Leah last week. She said “something is wrong this is too easy”
She and her husband had been looking for an investment property for over a year. In the end they used our Property Selector Service. In Monday Week 1 we had the Suburb Selection done, 3 suburbs and the areas in the suburb. By Friday I had interviewed Buyers agents in those suburbs and appointed and paid their engagement fee. Week 2 Wednesday the buyers agent presented 6 properties to me, I removed 4 and Saturday he inspected them. Week 3 Mon an offer was put in, building inspection done and the offer was accepted. Contracts were exchanged. That was it. By the following week we had the research done on 3 potential rental property agents and they were appointed. The longest thing we need to wait for now is settlement.
To make this even better the Buyers Agent is beside himself as it is the first sub $1mill sale in this sought after Melbourne suburb within the last 4 years. Leah is delighted as it was $110,000 below the purchase price guide she gave us and she is now asking herself why she spent a year out of the market and hadn’t done this sooner.
As ou can see it is all perception and those who.. “wait and see” may miss opportunities.
Now is the time to act, there is confusion and chaos in the market. The low clearance rates mean that sellers are going to be cautiously open to your discounted offer. The fact of the matter is that opportunity is born in times like these.
Data tells us from market slow down to recovery in the major markets in the last property cycles there has been 6-24mths. Would you be happy to buy now, at a discount and hold the property for the next 2 years in a great growth location that you may have previously been priced out of?
Of course, but I believe your time is even further limited. With the potential of Labour forming government before May next year you will see some investors wanting to lock in the current CGT and Negative Gearing policies. They will be swinging into action sooner rather than later.
Yep you read it here first. This ‘big’ market downturn could be artificially called sooner than expected when investors get back into buying mode first quarter 2019.
Denita Wawn, CEO of Master Builders Australia, called on the Labor Party to rethink its policies as a result of the modelling they have done. The economic model’s best possible outcome with changes to negative gearing could see 7,200 less jobs and reductions of $2.8 billion in residential building activity.
“Australia cannot afford for housing supply, building activity and employment to go backwards.” She said
Labor could just be hurting the industry where many of there union members work and let’s not forget the policeman, nurses and teachers who make up the typical property investor profile earning under $80,000 a year.
This will become a hotly debated topic in the next few months. You have a choice: watch the debate or take action.
As Warren Buffet says “be greedy when others are fearful and fearful when others are greedy”.
So why is it so hard or why is it so easy? You get to choose which perspective you take.Just remember it all comes down to where you buy!