1300 655 615 GET IN TOUCH

Propertybuyer Blog: Property Advice, Market Updates & More

Seven Reasons To Buy Now - April Market Update

By Rich Harvey, CEO & Founder, propertybuyer

Written by: Rich Harvey, CEO & Founder



The majority of buyers follow the herd by reading media articles and economists’ commentary and think they're making a good decision. But if you also follow the smart money and highly successful investors like Warren Buffett, you'll discover that the highly savvy buyers often go against the herd and time their purchase when other people think they're crazy. There's a lot to think about regarding the timing of your purchase; your finances, your job, the economy, the state of the local property market and a whole host of other factors that you can't control.

But one thing that stands out to me looking back over my property buying career, is that I've never regretted making a property purchase - even when the market conditions were hot or declining. One nugget of wisdom that was drilled into me from my economic days is the concept of opportunity cost. When you have the financial means and capacity to borrow money and then don't use that capacity, then that's an incredibly wasted opportunity.

How many of you would like to turn the clock back 5, 10 or even 15 years and said if only we had bought?

Here’s my rationale for buying property in the current market (as in fact I am doing right now).

1. Prices are stabilising. Demand is very location specific. There is still growth left in the tank with some areas still seeing strong demand….not as much as during the lockdown periods when listing volumes were severely curtailed, but we are still seeing competitive auctions and good numbers at open homes. Demand for property is vastly different in Brisbane / Gold Coast/ Newcastle compared to Sydney and Melbourne. Property prices are naturally slowing – but for how long we don’t really know. Don’t rely on bank forecasts which are notoriously wrong – eg CBA predicted a 30% fall in prices due to Covid at the start of 2020 - but the opposite happened. Don’t listen to the perpetual economic bears like Shane Oliver (AMP) that always talk prices down and sound worried about the housing market.

2. Rents going through the roof. Rental prices are rising very quickly. SQM Research recently indicated that rents are rising at an annualised rate of almost 15% pa. If you are an investor then you are much better off buying now so you can realise a higher yield and ride the journey of rental increases (rather than waiting till rents have risen and competing with thousands of other investors who want a slice of yield heaven.)
Home buyers are better off buying now, rather than renting or waiting for a market correction – which is likely to be very small.

3. Ultra-low vacancy rates. National vacancy rates are now less than 1%!  One of the bug bears for investors is having a vacancy period – but with the current market, investment property is being snapped up with long waiting lists in some areas.

4. Building costs rapidly rising. The cost of building materials and trade labour is escalating rapidly which means that the cost of replacing or rebuilding your existing home is significantly rising (ie the physical asset on your land has increased in value due to building price and trade price spikes). Sitting on your hands waiting for a market correction is a false economy as the increased cost of building will likely exceed any potential land price fall.

5. Net Migration Increasing. Skilled Foreign workers and students are coming in much greater numbers (with borders re-opening we will see demand for property rising yet again.) Net overseas migration is expected to rise to 180,000 in 2022-23 and fully recover to around 235,000 people per annum by the year 2024-25 (which was the level before the pandemic hit).

6. Building approvals declining. We are entering the next phase of the property cycle. Predictions show that we will have deficit of 163,400 dwellings by year 2032 (according to the State of the Nation report). Over 180,000 new household formations per annum are expected between now and the year 2032. In other words, we are now entering a phase of overall supply deficit in the property market.

7. Opportunity Cost. If you have the borrowing capacity to buy now…then why wait? It takes considerable time to get finance pre-approval set up and then you usually have 90 days before that expires. What if an unexpected change came with your financial situation? Would the banks continue to lend you the same amount? I would take action to buy now and make immediate use of any borrowing capacity that you have. It is far better to be in the property market than watching from the side lines. Property ownership gives you more life choices.

If you are looking to buy a home, investment or commercial property please reach out today on 1300 655 615 for a friendly discussion about your plans or send us your property brief here.


Click here to:

Send us your property brief


Would you like to receive FREE updates with hot tips & market trends?

We're ready to help

Take Quiz