4 tips on investing in Australia’s hidden gems in property

Published on December 1st, 2020
  Written by 
Bill Tsouvalas
Bill Tsouvalas is the managing director and a key company spokesperson at Savvy. As a personal finance expert, he often shares his insights on a range of topics, being featured on leading news outlets including News Corp publications such as the Daily Telegraph and Herald Sun, Fairfax Media publications such as the Australian Financial Review, the Seven Network and more. Bill has over 15 years of experience working in the finance industry and founded Savvy in 2010 with a vision to provide affordable and accessible finance options to all Australians. He has built Savvy from a small asset finance brokerage into a financial comparison website which now attracts close to 2 million Aussies per year and was included in the BRW’s Fast 100 in 2015 as one of the fastest-growing companies in the country. He’s passionate about helping Australians make financially savvy decisions and reviews content across the brand to ensure its accuracy. You can follow Bill on LinkedIn.
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If you have been following the Australian property market boom in 2016, right down to its cooling period as an investor you might have one question in mind. How were other investors able to see the forthcoming boom, and able to cash into place like Sydney which had house prices that sat at the value of $1,123,991. It’s all about following the hidden gems placed around statistics, and keeping an eagle eye out for the trends in the property market. We have put together four tips on how to find these hidden gems to help you spot the next property boom that you can invest in.

Before gaining on your investments know one of the golden rules

There are just over 7.9% of Australian property investors who currently own one property. This means that there are a number property investor’s who are already in the game to offer you some sage advice. Speaking to a professional financial advisor when it comes to getting a property loan, and knowing where to invest it will also be beneficial in the long run. Property investors who have been doing this for long may not give you everything on a silver platter, but they are willing to prevent you from making the same mistakes they did when they started out. Property investment is a slow accumulation of wealth.

The key is to invest when the market is down in a location that has good fundamentals.

With so many places up for sale, or potential investments where should you start? Research is your best friend. By knowing your market and recent trends you will be able to invest in property that will benefit you. Furthermore, you will be equipped with rock solid negotiating skills by knowing your numbers. Data and research go hand in hand. When looking for property look at data that is no older than 10 years concerning each suburb you could be interested in. This will tell you the story of the place, and whether it is a worthwhile investment. Look at the percentages in terms of growth to follow where the money is. What could help you is to see which places have had the most growth within the 10-year period. The obvious choice is to go with the on which ranks higher.

Hidden gems that can be developed into diamonds

The obvious option when it comes to investing is to look at cities and suburbs that are currently hot property. However, there could be plenty that could be invested into within a 20-km radius out from the city or suburb you wish to invest in.

Property is becoming expensive, costing its residents a lot of money to stay in. You can always tap into the market of people who are looking for alternative cheaper property that is still close to these well-known suburbs, and business centres. Buying property under market value can see you gaining exceptional returns. A person can be selling below market value because they need instant cash, or simply because the house isn’t selling. By purchasing the property and adding a few renovations when the market is still down can see you making 5 – 10 times more than you initially invested. It is advisable to avoid buying property on an emotional hunch. Just because you like the look, or feel of the place does not mean it will make money for you.

What are the predictions for 2018 to get you started?

A recent report by REA group’s Property Demand Index shows that Redwood Park is becoming hot property for your investment choice. According to CoreLogic, Redwood Park’s median house price ranges from $373, 5000, with a median weekly rent at $350. The annual rental yield sits at 4.9%. The next best suburbs were Melrose Park and Marino. Adelaide’s appeal is due to it providing 84.5% of the state’s employment. You might have missed a few opportunities in the past, but this time around you want to catch the next momentum before it hits. The trick is to follow the paper trail of data and what is being said at the market. However, the decision to make your move is with you.

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This guide provides general information and does not consider your individual needs, finances or objectives. We do not make any recommendation or suggestion about which product is best for you based on your specific situation and we do not compare all companies in the market, or all products offered by all companies. It’s always important to consider whether professional financial, legal or taxation advice is appropriate for you before choosing or purchasing a financial product.

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