It’s interesting that people here and there are describing right now as being a good time to buy.
However, yields are still low in capital and regional cities… too low for many seasoned investors to consider buying, even though they might still be keeping a close eye on their respective market.
What’s the view of the forum on how long it will take before yields catch up again? Personally I think it will take a few years…
This question is re: Australia, not New Zealand, and while I know there are markets within markets, it’s more of a general query…
Cheers
rHey Richmond,
I have seen 4 cycles in my investment life, where prices and yields are running in opposite directions and again when they have been parallel to each other. It is nothing new, and certainly nothing to be feared (not for the seasoned investor); perhaps this is so for the more “fly-by-nighters” but certainly not for those who are serious about long term investment.
I particularly don’t mind having lower yields ATM because I know it will be short-lived. But more importantly, because yield without growth (IMO) is not viable (for me) as my preference is for growth, which BTW is also stagnate ATM, however again, this is also not a long term state. True, it may take a few years to see a shift prices, and yields, but overall, things will (and always have) panned out in the the wash!!!
It is definitely (again, IMO) time to buy, or at the very least, offload “non-performers” in exchange for “future performers”!!!
Cheers,
Jo
i have to agree with monopoly on this one.
i am currently selling off one IP, not because its not a good performer, its just to release equity that i would have had to pay interest on, ie a LOC. by selling i get 50k cash after expenses. this will greatly help for deposits when the next deal comes along.
i’ve just found (and please correct me if i’m wrong) trying to borrow 106% for an IP these days really makes the numbers not worth it. at least with a cash deposit i am still in the game. and the rental yeild can be a lot higher, and i dont have to try and buy in mining communities.
just my two cents worth anyway
cheers
shaunLead, Follow or get out of the bloody way
Hi Richmond
i don’t expect to be able to buy properties for “cash flow” perhaps ever in Australia again. It would take either interest rates to be 3%, rents to be double or the market to fall at least 30%, or a combination of these events. I like to make at least 12% return and i don’t expect to see that again. Therefore i’d be buying for capital growth (if i was to buy) and i can’t see any capital grwoth for a long time (years). The only property i’ll be buying is a new home for myself to live in when i decide to come back to Oz from New Zealand. I might move to the Geelong area perhaps the Belleraine Peninsular.
regards westan
I live in New Zealand and for a fee find cash positive deals there, email me at [email protected] to join our database
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