Australia is currently experiencing the most significant shortage of housing accommodation it has ever seen
A saying goes, “buy when others are selling, not when everyone is buying.” It is now time to buy. Whilst many are waiting for land prices to come down, the smart ones will buy now, especially if they are investors.
As for the first homebuyers who choose to wait, they will be hit with higher rental prices and should also remain active in the market. Australia is currently experiencing the most significant shortage of housing accommodation it has ever seen, and rents are increasing rapidly; this provides investors with a perfectly timed opportunity to capitalize on the shortage.
What about interest rates? The increase in rental yield is helping to offset the rise in interest costs, not to mention that investing comes with tax benefits that also help offset the higher payments caused by interest rate rises.
In my opinion, we are not going to see land prices reduce because of the current economic situation; land developers have been struggling to construct and deliver the stock they have sold in the last two years of boom times. This slowdown will provide them time to catch up on production and complete the land construction of the hundreds of blocks already sold, so they don’t need to take drastic measures and reduce land prices. Add to this the rising costs of both purchasing development sites and civil construction, it is even more unlikely developers will be reducing costs. It just won’t be feasible.
There is also currently a massive shortage of residentially zoned land on the outskirts of Melbourne, and this can only put upward pressure on prices; plus, we expect to see clever investors return to the market over the next six months to capitalise on the rental market shortage, this will continue to reduce the amount of zoned land available.
Forget the doom and gloom; the smart ones buy in difficult times if they can afford to do so. Don’t delay your purchase and regret it later. Life goes on, make your own decision, and don’t rely upon the experts who have got it wrong for so many years. Remember at the start of COVID when we were reading about how the property industry was going to be dreadful? They got it wrong, and we experienced one of the biggest booms in history. Now’s the time to get out there and create a better life for yourself and your family.
