I recently sold an investment property, just before Christmas, and am now looking for my next reno investment. The market in suburban Victoria is really moving and it is difficult to compete with first home buyers and other investors.
I am conducting my due diligence inspections on properties and then making offers after considering all costs. Unfortunately I am not getting close to a purchase. I could increase the price I am willing to pay but this will require a higher sale price.
My concern is that interest rate increases, that will surely occur, and the end of all the first home buyer incentives will soften the market. If this happens I could be left with a high priced renovated property that wont sell.
I could hold and rent the property, which is my contingency plan, but then I will have a heavily negatively geared property.
Any advice on this ?
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