As one of Australia’s largest cities, Sydney is an attractive investment prospect for residential property investors looking to diversify and boost their portfolios. However, with economists warning that house prices could fall by up to 25% in Sydney in 2019, it’s vital that investors choose their target properties wisely.
In past years, the Federal Budget’s focus has been on improving housing affordability but 2018 saw the biggest drop in house prices since 2015, it appears the government have slowed down their pursuit.
Sydney, Melbourne and Brisbane are the three biggest investing hubs in Australia, however according to Core Logic, the city that is achieving the highest rental yields is Brisbane.
As at July 2016 Brisbane’s rental yields were sitting at 4.3% per annum, whilst Sydney and Melbourne were at 3.1% and 3.0% per annum.
This means, if you purchase an investment property at say $600,000 for example, you would receive the rental value of:
Brisbane: $496 rent p/w
Sydney: $358 rent p/w
Melbourne: $346 rent p/w
The Reserve Bank of Australia has announced that it will cut interest rates. This sets a new record low rate of 1.75% – the first change since May last year.