Property investors committed to $11.71 billion of home loans in July 2024, which was the second-highest month on record, according to the Australian Bureau of Statistics.
It was also 35.4% higher than in July 2023, showing the enormous growth in investor activity during that time.
Here are five reasons why so many Australians consider property investing a great way to build wealth:
- Capital growth – property prices have increased significantly over the long-term.
- Rental income – the income you collect from your tenants can contribute to paying off your mortgage.
- Tax benefits – you can potentially reduce your taxable income if your expenses exceed your income.
- Diversification – property can balance out any shares you may own through your superannuation.
- Flexibility – once you’ve accumulated enough equity in your investment property, you can use that to fund the deposit on another property.
Housing assistance scheme helping tens of thousands of buyers
The federal government’s Home Guarantee Scheme (HGS) helped 43,800 buyers enter the market in the 2023-24 financial year, Housing Australia has revealed.
The HGS contains three separate programs:
- The First Home Guarantee helps eligible first home buyers to purchase a property with a 5% deposit without paying lender’s mortgage insurance (LMI).
- The Regional First Home Buyer Guarantee is almost identical but is limited to regional buyers purchasing regional properties.
- The Family Home Guarantee helps eligible single parents and single legal guardians buy a property with a 2% deposit without paying LMI.
The federal government has allocated a combined 50,000 places for the three programs in the 2024-25 financial year.
All three programs are reserved for owner-occupiers, have income limits ($125,000 for single applicants and $200,000 for dual-applicants) and property price caps (as per above).
Please contact us if you’re thinking about taking advantage of the HGS.
Good news for buyers, with property listings rising 7.9%
Home hunters have considerably more stock to choose from than earlier in the year, putting buyers in a stronger negotiating position.
SQM Research has reported that the total number of listings across Australia in August was 7.9% higher than the month before and 11.1% higher than the year before, while the number of new listings (those less than 30 days old) rose 11.8% month-on-month and 8.5% year-on-year.
“Going forward, the spring selling season will provide a significant level of choice for buyers, particularly in Sydney and Melbourne, with listings at their highest levels in some years,” according to SQM Research.
This is good news if you’ are looking to purchase a property, as you will be presented with many more options. Spring is often the busiest time of the year, with an uplift in real estate activity, so please reach-out if you would like to assess your borrowing capacity or would like to secure a pre-approval before going house shopping.
If you are buying, re-financing or have any questions, contact me on the below information.
Sal Cinque | CEO
TAG Finance and Loans
03 9886 0800 | loans@tagfinancial.com.au
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Disclaimer: The information contained on this page is general in nature. Professional advice should be sought before acting on any aspect on this page. TAG Finance and Loans Pty Ltd ABN 25 609 906 863 Credit Representative Number 483873 National Mortgage Brokers Pty Ltd ABN 88 093 874 376 Australian Credit License 391209.