more properties to let in the next ~5 years = low rent income?

[r3ckless]

Hi all. With the interest rates falling down to record lows and people snapping up property's all over sydney. Possibly investment to let out to tenants... my interpretation of this is in approx 5 years there will be so many proeprty's for tenants to choose from and thus they will be able to get a very competitive ie. Low rent!

This is my interpretation however i am only coming into the property investment portfolio.

Is my interprtation completely wrong, am i reading the market wrong etc?

Discuss!

 

[Darlogus]

Hi all. With the interest rates falling down to record lows and people snapping up property's all over sydney. Possibly investment to let out to tenants... my interpretation of this is in approx 5 years there will be so many proeprty's for tenants to choose from and thus they will be able to get a very competitive ie. Low rent!

This is my interpretation however i am only coming into the property investment portfolio.

Is my interprtation completely wrong, am i reading the market wrong etc?

Discuss!

It's part of the property cycle. In 5 years your IP will go up, your rent will go up, the interest rate will go up. Vacancy rates go up. Lots of investors stop buying and in fact sell.

Market will peak and level out and off we go again.

I had your thoughts back in 2001 when lots of people I knew was getting into property, most sold years later, helps to keep balance.

 

[HD_ACE]

Your not taking into account population growth which will increase demand.

Cheers

 

[geoffw]

It's happened in Canberra- about three years of lots of new supply, vacancy rates rising, and static rents- after some years of good rises.

It's a normal economic cycle. Rental returns were good, so lots of people jumped in to build, especially high rises. By the time many of them are finished, it's affected the supply and therefore returns.

This will probably mean a lot less building for a few years- there's already signs of this. The balance will probably come around again.

Canberra is a smaller more contained area, so perhaps a bit more sensitive to this sort of cycle. One high rise in Canberra will be a much bigger percentage of the total supply than the coastal capitals.

 

[see_change]

If that's a concern , buy in nicer areas where people are going to want to live .

Always a demand for units close to the city from the yuppies who complain about how unaffordable places are to buy .

Cliff

 

[r3ckless]

Thanks for yuor input people!!!

Yes I am looking in inner city atm!

 

[slumpMunkey]

Hi all. With the interest rates falling down to record lows and people snapping up property's all over sydney

just my opinion: yes interest rates are low but prices are climbing so i dont think people are jumping in just because rates are low.

some renters will always rent and there will be always more new renters. alot of people cant get $1000 together to rego the car let alone $40,000 to buy a house.