There is little else as disappointing for people than to be priced right out of the suburb or area that they are currently living in, with Generations Y and X being more familiar with this trend than any other generation. A survey done by finder.com.au revealed that 13% of Australian property hunters are searching for homes outside their capital cities.
Another survey showed that 54% of buyers are afraid of purchasing homes in the wrong areas, while just over 70% first time buyers fear not being able to afford homes in their desired locations. If you are a potential buyer who has been priced out of central Melbourne, the advice below could help you find the property of your dreams elsewhere.
Think Outside the Box – Or City
A seasoned property investor, Margaret Lomas from Destiny Financial Solutions, has built a portfolio consisting of 40 properties in cities and regional areas. She said, “Capital cities aren’t exclusively the best place to buy. Just because you buy in a city doesn’t mean you get better growth and rental yield than you do when you buy outside of a city.” She went on to say that areas grow in relation to specific fundamentals, which are not strictly confined to capital cities like Melbourne.
Lomas mentioned further, “They include a population growing faster than the national average, with a predominance of families, a diverse economy offering a broad spectrum of employment opportunities, and a local government which is supporting the growing population with suitable infrastructure and lifestyle amenities. We often see these fundamentals in some of our larger regional areas which have become fully self-sufficient.”
Where to Search
Another investor, Nathan Birch from Binvested, purchases properties in the Gold Coast and Brisbane because they tend to be undervalued. “There is a difference between areas that are cheap compared with areas that are undervalued,” he said. “Brisbane and the Gold Coast are what I consider to be undervalued. The rate of growth in those areas is faster than Sydney and Melbourne and I think people will look back in 10 years and regret not buying in those areas.” Birch recommends that potential buyers who have been priced out of the Sydney market should seriously consider looking at properties on the Central Coast.
Always Inspect Before Purchasing
Regardless of how good of a deal a house sale seems to be, having a pre-purchase inspection and a termite or pest inspection performed is crucial. A qualified inspector will point out any defects that are present on the property and inform you whether they are able to be repaired or not. This will help prevent a lot of unnecessary expense and heartache down the road.
Although it is an exciting process to purchase a home for the first time, it’s important to ensure that you choose the right property in the right area, as homes in areas that are considered ot be undesirable could be close to impossible to sell at a later stage.