- by Tim Nimmo
As we mentioned on our blog earlier 60 Minutes recently ran a story about the ‘rentvesting’ phenomenon called ‘Helter Shelter’, click here to take a look. You could say that ‘rentvesting’ is well and truly in the mainstream.
And with the housing crisis all too real for so many Australians it’s encouraging to hear that the authorities are taking the challenge of housing affordability seriously, and indeed this issue was central to the Turnbull government’s last federal budget and even the focus of a task force setup earlier this year.
However, even the most common sense solution of increasing the supply to drive down prices has its complications, Chris Mountford of the Property Institute of Australia believes the supply currently coming onto the Sydney market only really addresses years of under supply. Professor Hal Pawson of the UNSW Housing Research and Policy goes even further and claims that the factors at play on the Australian housing market are simply too complex to pin soley down to just a lack of supply, and that demand is being artificially inflated by policy, which he seeks to addresses in his proposed 10-point solution to the housing affordability crisis. Given that Professor Pawson’s proposal is unlikely to gain legislative authority in the short to medium terms, and that the amounts of supply required to apply immediate downward pressure to prices not currently there, the chance that Sydney prices will continue to climb remains not just a possibility, but even a likelihood.
Where does that leave the emerging generations? As covered in the 60 Minutes story the struggling pre-millennials are viewed as victims by some, and as complacent and entitled by others, but not wanting to get lost in the debate here it’s far more helpful to simply accept that forward progress can look different between generations and ‘rentvesting’ is now something of a new normal. Simply put the first rung on the property ladder may no longer be in your own city, it may be in a market 1000s of kms away… but this doesn’t make the first step any less effective.
Indeed, many of our partners are doing exactly that, looking for the first rung on the property ladder but they don’t have the time or desire to become experts in interstate property markets. Knowing Australia’s emerging markets however is what drives us, so come find out how we can help you achieve the dream of ownership. Also, don’t forget to ask about our ‘buy with confidence’ initiative, as we find investment properties priced within 5% of bank valuations to ensure you’re getting a fair price.
Looking forward to talking with you soon,
Tim, Talal and the team…