Should I buy property now or wait?
With auction clearance rates in Sydney hitting a 24 year high and sale prices consistently achieving hundreds of thousands over reserve. We are officially entering boom phase.
Is it time to be fearful or is it the right time to be greedy?
There are two conflicting emotions at play here.
Fear and greed. The fear of missing out on price gains and greed, driven by the desire to accumulate wealth.
Historically, property has always faired well after a downturn. Like clockwork, there has been a bounce in prices following some kind of economic crunch. This time is no different.
Well sort of.
This time conditions are combining to create a perfect storm.
We have record low interest rates that are likely to stay low for at least 3 years.
We have record government spending on infrastructure and economic stimulus packages.
We have extremely high household savings levels and the loosening of bank lending criteria arrived in March.
All this extra money has to flow somewhere. Banks aren’t paying us enough to keep it there so wherever it flows is where we see price inflation. Have you noticed the price of cars, caravans, bicycles are all rising? What else?....real estate. Although it’s a little slower.
For the long term, population growth and national economic health are two of the big driving factors of price growth.
With the government planning ways to recover and grow our economy like never before and drive population growth along with the likelihood of migrants flocking to our Covid safe haven after our borders open, we are in a prime position to see these two factors influence price over the long term.
So in conclusion, there’s always risk in buying property but there’s also the risk in not buying.
Something i’ve said many times, property is a long term game.
Buying with a long term plan and a step by step strategy to achieve your goals is the key to creating wealth through property.
Drop me a DM or book a chat on my website, link in bio, if you want help creating a clear plan and a strategy to achieve your wealth goals.
I’m always happy to have a chat!