We live in very uncertain times. With COVID-19 rapidly spreading across the globe and in Australia, the streets are eerily empty as people work from home and practise social distancing. As such, many people who were looking at buying homes – especially investment homes – are wondering if it’s still the right time to do that? At Buy Investments Australia, we get a lot of asks for property investment advice in Melbourne. Is now the right time to buy? Or should people wait?
In short, yes, it is still an excellent time to buy an investment property. Even though the coronavirus is impacting the way we live and work in multiple ways, one constant remains the same – people need a roof over their heads and a place to sleep at night. Here two reasons, in particular, why you should still consider buying an investment property.
At the end of last year, experts were predicting property prices would rise 5% across the country, with particularly excellent pricing growth in Sydney and Melbourne. Even at 5%, that’s a fantastic ROI and outpaces loan interest rates and inflation.
Australia, in particular, has enjoyed a very favourable appreciation rate on homes in recent history. A $100,000 home purchased in 1993 would be worth nearly $600,000 in 2018 (25 years later). That’s an annualized growth rate of 6.8% and, in that time, we’ve had multiple recessions and downturns.
Even if COVID-19 causes a recession, there’s no reason to believe that prices won’t rise significantly again after the pandemic subsides. Trying to time the market tends to be futile. Whether you bought a home for $90,000 or $110,000 in 1993, the growth to $600,000 dwarfs any small over or underpayments of the original purchase. Jump in and take advantage of historically favourable ROIs!
It’s A “Safe” Investment
Of course, those predictions were before COVID-19. Given the fact that the stock markets have been plunging with no end in sight, it might be reasonable to assume that housing prices would follow suit and, therefore, now would be a wrong time to buy. In reality, the opposite is happening. Property prices are holding steady. Prices may have slight declines in the future, in general, property fares very well in recessions.
As such, if you’re looking for a comparatively “safe” investment in these uncertain times, real estate could be your way to go. This property investment advice in Melbourne is especially applicable given the fact that this city is in very high demand.
Property Advice in Melbourne: Still A Good Idea!
COVID-19 is something that nobody should take lightly. It’s a severe disease that is already having significant impacts all around the world.
In terms of your property investments, however, there’s not enough evidence to hold off or change any plans that you had. If you were looking at an investment property, it’s still a fantastic idea. Once things pass over, this country will likely return to the same appreciation that investors have enjoyed over the past two decades. It’s also a “safe” investment because properties tend to do well in recessions.
Of course, nobody has a crystal ball, but the best property advice in Melbourne would still be to buy!