You don’t have to be a real estate expert to know that property and rent prices are skyrocketing at the moment, with the latter area also experiencing plunging rental vacancies.
Then there’s our 15th consecutive month of 0.1% record low interest rates and an inflation rate of 3.5% over the year to December, with the recently released trimmed mean figure of the last quarter at 2.6%, according to CoreLogic.
This highly interesting – to say the least! – situation has plenty of potential home-buyers wondering if they can afford even a shabby shack in Timbuktu.
Can I afford to buy a nice home?
We at Lending Loop have been pondering this question a lot lately but it was some recent words from Reserve Bank of Australia’s (RBA) governor, Dr Phillip Lowe, which made us think differently on this issue.
In an address to the National Press Club last Wednesday, Dr Lowe commented that most people were now choosing to live in “fabulous cities on the coast (and) we want large blocks of land”.
While these words didn’t impress a lot of people, Lending Loop saw it as a good chance to bring some positive hope to those disillusioned by current economic and real estate figures.
Basically, yes, living in a fabulous coastal city on a mega block of land – or even in a nice suburb with some greenery – may not be possible anymore.
But you don’t have to ditch your house dreams altogether because guess what?
Everything’s not lost
Be prepared to make some sacrifices and accept some imperfections to find that great property.
Here are our favourite unconventional and creative ways to beat today’s difficult economic figures:
1. Look for places near large parks, playgrounds etc
We’ve all seen those rather bland properties with little character or space to spare, if at all.
But look beyond the tiny bland and aim for a place within walking distance – or a short drive to – parks, sports fields, playgrounds, or walking and cycling trails.
For families, in particular, having spacious play areas nearby will make a big difference.
2. Tiny houses or townhouses
They’re all the rage now and it’s easy to see why: tiny houses cost far less than the average house and can enable you to live on a big block of land or even travel in style.
Another, similar but larger option, is to buy a townhouse with a courtyard or a small, private garden.
This way, you, your kids and your pets can still enjoy some outdoor space.
3. Move outwards
While not a new idea, moving to an outer suburb is a particularly pertinent plan for first-home buyers.
These suburbs may not be uber-rich and fashionable and living there may mean a longer commute to work.
But many many of these places are swiftly gentrifying and are often closer to regional and rural areas that make great places for you to visit on weekends and holidays.
Your outer suburb property doesn’t have to be your forever home either.
An increasingly popular idea, rentvesting effectively allows keen buyers with limited funds to enjoy the best of both worlds.
The concept means you can rent your current home for its preferred, yet expensive, location and lifestyle while buying an investment property in a cheaper suburb.
In this way you can live where you want to live, even though this means you’re still renting, while also enjoying the benefits of property investment.
Any profits from your investment can be used to pay your rent and the concept can also give you tax benefits.
Cheers to cheaper!
Wherever you are in the property race, we encourage you to be confident and go forth, particularly now that we’ve hopefully given you new ideas and encouragement to do so – and if nothing else but to defeat depressing figures!
So, give us a call today at Lending Loop.