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The share market can undergo big drops in just one day - the real estate market generally doesn’t.
IT doesn’t matter if property price growth is going to slow down this year, it’s still a good time to invest in real estate according to Hotspotting’s Terry Ryder.
Here’s why:
Constant share market upheaval has reinforced the relative solidity and reliability of real estate.
Mr Ryder said house prices never fell by 3 per cent in a single day like the share market could.
The APRA measures and banks’ changes to lending criteria have helped to keep markets safe
and reduce the chances of post-boom price collapse.
There are still opportunities to buy well in most locations around Australia. Mr Ryder said only Sydney and some parts of Melbourne have had major price rises.
Terry Ryder reckons there are still many reasons why it is good to invest in real estate.Source:Supplied
Good momentum in smaller cities. There is good momentum in the smaller cities, notably Brisbane, Adelaide, Hobart and Canberra, with solid (though not major) price growth likely to follow in the short-term.
Some areas are hitting the bottom of the cycle. Mr Ryder said the Perth market passed its peak three years ago and was now approaching the bottom of its cycle.
This he said presented opportunities to buy well without competition from other buyers.
There are still opportunities to buy cash flow positive.
“Opportunities exist across Australia to buy real estate that is cashflow-positive or at least cashflow-neutral,’’ Mr Ryder said.
“They’re easiest to find in good regional centres and the cheaper cities. Those who can’t afford city prices – or who want better yields – can target strong regional cities with diverse economies as many of them will show growth this year and beyond.
Infrastructure spending. There are still many areas with significant infrastructure spending which is one of the great generators of real estate price growth.
Mr Ryder said to particularly look at areas with spending on transport infrastructure.
He said spending on education and medical facilities could also be influential.
Spending on infrastructure is usually a good generator of real estate price growth.Source:News Corp Australia
Low interest rates. Interest rates continue to be very lo. Even if they rose two or three times, they would still be low.