Investors could be a prime target market for brokers as property prices soften and rental values soar.
Rental price growth of as much as 50 per cent over the next four years was predicted by BIS Shrapnel in April. Building approvals have also fallen well short of demand according to recently released ABS figures.
Warren McCarthy, chief executive of LJ Hooker, said he had seen a steady move back to property investment spurred by two strong drivers.
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“We have been seeing a swing back to investing since around this time last year and we expect this will continue as house prices soften and rental yields continue to improve,” he said.
Mr McCarthy also said many investors now preferred the stability of bricks and mortar as an investment compared to the “wobbly” stock market.
First time buyers as well as experienced investors are likely to be attracted to current market opportunities, he said.
“First home buyers can take advantage of stamp duty concessions to buy their first home and we are seeing a lot of them rent their properties out and stay at home with mum and dad,” he said.
Warren O’Rourke, national corporate affairs manager of Mortgage Choice, said low vacancy rates, rising rental returns and the volatile nature of the equity market made property investment attractive for first time buyers as well as owner-occupiers.
“Property [investment] is presenting strong opportunities for borrowers – and therefore brokers as well,” he said.
“It’s hard to speculate about who in particular might be interested in property investment, however I think it will be appealing to anyone who wants a balanced portfolio.”
At a glance
• Rentals expected to surge by 50 per cent
• Trend towards houses over sharemarket for investment
• Growing popularity with first home owners
