The monthly meeting of the Reserve Bank of Australia produced no surprise today, as the board announced official interest rates remains at the record low of 0.10%pa. Experts predict that there will be little or no movement for the rest of the year.
The investment property and owner-occupied property markets are unusually busy for this time of the year. Interest rates have never been lower, so it’s no wonder it’s a hot market for property investors. In fact, the latest Australian Bureau of Statistics housing data shows that borrowing for investment properties is up 50% from last year.
So, is it time for you to consider an investment property?
Your starting point is checking your credit rating. If you pay your credit cards on time, you should have a good rating. Next, have a look at your mortgage and the equity that you have in your house. This is important and should also give you an idea of the price range of your potential investment.
Assuming everything is in place, the next step if finding your investment. Do your homework on this – the ideal investment property is probably in another town or even in another state.
Look at areas that are up and coming – this could be regional areas or on the outskirts of major cities. Ensure the area has proper infrastructure – public transport, schools, shops and other facilities. All of these factors can have a considerable influence on the potential future value of the property.
Also do some groundwork on the type of people who may want to rent your investment property. What is the employment situation in the district? Are there industrial parks, hospitals, shops, factories or business areas nearby? The more information you have, the easier it will be to make a decision.
Arranging finance is the next step. You’ll need to talk to an experienced mortgage broker. That’s where we can help. Even if you are just considering an investment property, give us a call and we can take you through what to expect.