Before moving into the Surfers Paradise property market to secure you own real estate investment, it's important to sit back and take a look at the wider economic context – not just of Queensland, but Australia in general. After all, property investors have more to win and lose from these financial movements in the market than owner occupiers, especially for those with unfixed home loan rates on their mortgages.
The property market doesn't exist in a vacuum outside of the influence of other societal factors. In fact, it can be volatile at times, with a lot of foresight and care needed to pick the right time to make property movements. Just like looking for areas with projected future growth, taking the current and future movements of the national economy into account should be a big concern for investors – both experienced and first timers.
Here are some of the things to look into before committing to investment real estate in Surfers Paradise.
Projected population growth
One of the big ones to think about is population growth. Basically, if there aren't new people coming into the nation to demand houses, there's no need for investors to supply real estate. However, the current circumstances in Australia are indicating a strong degree of growth in population – both from overseas immigrants and natural growth through births – over the coming decade, which should help put potential investors at ease.
Furthermore, the nation is experiencing an ageing population, with people living longer than ever. This is leading to the creation of a lucrative retirement market for elderly individuals looking for properties where they can enjoy the fruits of lifelong work and spend their golden years living it up. Therefore, holiday homes and units in capital cities are becoming increasingly popular and could be a good investment to consider.
Confidence in the property market
Another common trope to consider when buying investment property is the overall degree of confidence people have in the market. There are a number of different surveys released at regular intervals throughout the year, which document and track these figures across the nation's major metropolitan hubs. Taking note of these when planning your investment movements – especially the projected figures for the future – is a great place to start your portfolio research.
These reports look into the number of construction starts and market movements – not just residential property, but commercial, retail, industrial and office spaces. Tracking the climbs and drops of construction across your local region can offer some insight into the market that are currently performing well, while also presenting the early seeds of where the area's economy is heading in the future. If these figures have been dropping consistently, it could be worth holding off from investment until things turn around.
Current interest rate movements
The Reserve Bank of Australia's official cash rate is discussed and agreed upon every month and can have a massive effect on the nation's property market. This is because the cash rate influences interest rates charged on financial products such as home loans. When the cash rate is low, oftentimes interest rates also see a decrease, making them more attractive to people looking to purchase property without being stuck with large interest repayments.
On the other hand, if the cash rate starts to rise, so do interest rates. So taking out a home loan for investment in Surfers Paradise property while the cash rate is low is a great sign to keep an eye out for. The current cash rate environment has been at the historically low level of 2.5 per cent since August 2013, indicating that now could be a brilliant time to consider securing finances and making moves into the Gold Coast property market to begin building your investment portfolio today.