Why savvy property investors are buying now

In the world of real estate, it’s almost always possible to turn a negative into a positive. When headlines and doomsayers have people feeling fearful, it’s actually a great time to take action.

Here’s why we are currently receiving calls from investors who understand that opportunity is actually knocking right now.

Interest rates keep other buyers away

After keeping interest rates at record lows for a prolonged stretch during the height of the pandemic, the Reserve Bank of Australia (RBA) has started raising interest rates.

While this has put pressure on people with mortgages, it has also seen a levelling off in house prices, which can positively affect a choice to invest in property.

If you do have the funds to afford a mortgage at current rates, you shouldn’t find they rise too much more over the course of this year. Once inflation is under control, economists say rates should plateau.

Secondly, rising rates are forcing some people to sell. This brings more stock onto the market, which leads to opportunities for savvy investors.

According to the Australian Bureau of Statistics, the number of loan approvals in November 2022 was down 23.2% from 12 months earlier. As you can imagine, this is not a figure that appeals to lenders, so it may be easier than ever to pick up a few perks such as cashback or competitive terms when you apply for an investment loan.

Rental yield is high

Another impressive incentive to invest in Sydney real estate in 2023 is the demand for rental properties.

Home prices may be falling, but rental prices are doing the opposite due to extremely low vacancy rates. Right across the country, rental yields are looking extremely healthy, reaching record highs in almost every capital city, Sydney included.

The more income you can generate from your rental property, the lower the holding costs will be and the more you will gain in the long term. With rental yield at all-time highs in Sydney, this is certainly a strong incentive to leap into the property market as an investor.

Winners are playing the long game

While rental yield is a strong incentive to invest in real estate in 2023 and those who have the budget to buy are finding less competition, there is always the question of resale value. Nervous investors say they worry about losing money.

This is where strategy comes into play. Investing in real estate is a long-term game. If you’re looking to make some fast money, now may not be the time to invest. However, if you don’t plan to sell in the next three years you should find that small losses rapidly turn into larger gains.

While figures differ between property styles, it is generally recommended that you hold onto your investment property for somewhere between five to ten years. Keep your property for this length of time, and you are all but guaranteed to make money when you sell.

Why invest in Neutral Bay?

Neutral Bay is one of the best investment property suburbs in Sydney for the following reasons:

• Apartments: Apartments that are close to the CBD make excellent investments. They are much lower maintenance than houses and are highly sought after by upwardly mobile younger people with disposable incomes.
• Location: Neutral Bay is the perfect mix between inner city living and stunning natural surroundings. Its natural beauty and its proximity to the Sydney CBD make it one of the most desirable suburbs in Sydney and, therefore, one of the best places to invest.
• Stability: Neutral Bay has staying power. No matter what demographic shifts happen, central Sydney will always be where the jobs and the universities are, so Neutral Bay property will always be in demand.

Want to make a move while the market is quiet? Contact us to take advantage of current conditions.