While there are often temptations to sell a residential investment property, whether an opportunity to get an unbelievably high price through to a looming federal election creating uncertainty, taking a patient and long-term approach can prove more beneficial.
The property investor should really weigh up the long-term consequences of such a decision.
The property market is strong just about everywhere in this country right now, with investors generally enjoying stronger than ever rental yields. The demand for housing shows no sign of letting up. Prices still seem to be rising at a faster pace than anticipated despite interest rates concern.
Household disposable incomes are increasing for many through the stage 3 tax cuts, which will help borrowing capacities.
With the rate of new builds coming into the market still expected to be weak, the demand for established homes will remain high and keep the rental market extremely tight, which in turn might add to buyers competing in the market.
With so much happening, it pays to keep a close eye on the market if you are a property investor or looking to become one. In a time when there are market fluctuations, for instance, holding onto property investments can be a strategic and profitable choice.
Be long-term focused.
Investing in residential property is typically long-term investment, based on strategies for wealth creation and passive income generation. Don’t sell just to miss out on future growth potential.
Be patient.
Historically, property markets have proved resilient Downturns are typically followed by recoveries. Holding positions investors to benefit from any potential market rebound.
Be steady.
A rental market may remain relatively stable or even experience an upswing during market downturns. The investor has a steady stream of rental income, which enhances financial stability.
Be diversified.
Property investment is a historically popular option for securing financial stability in Australia, because your asset may appreciate in value over time, provide a long-term income stream that may increase over time, and may also provide significant tax benefits. Plus, it is usually more stable and less volatile than stocks. Real estate is a valuable asset class in a diversified investment portfolio.