The strength of the Australian dollar against the US and other currencies has seen many expats, who are paid in US dollars or other foreign currency, put the brakes on buying Australian property. Understandably they don't like the fact that their money isn't currently giving them the advantage it did when those currencies were far stronger.
However, is this ‘wait till the dollar drops’ strategy the right move for those who are planning to return home in the next few years?
Do you know who you’re competing against when buying a home or investment property after the Federal Government announced even more changes to the foreign investment rules on April 24?
What impact has the foreign investment rules had on our real estate market over the past 16 months and what impact will the new changes have going forward? How has it affected supply and prices and what’s likely to happen in the near future?
This week I joined Louis Christopher, SQM Research; Matthew Chun, Becton and Matthew Rollason, DibbsBarker to discuss these changes.
There’s been plenty of discussion in recent months about the increase of foreign buyers pushing up Australian real estate prices in established areas after the Federal Government relaxed the regulations last year.
A. With any property or other investment purchase you’re taking a risk. If you want to increase that risk then buy in an area that you’re not familiar with - and if you really want to take your risk to the extreme then buy in another country.
My general rule of thought on buying OS property is that if the property deals really are as good as they seem then the locals would buy them.
Don’t go overboard with the current low interest rates. Whilst rates are at 49-year lows, remember that they won’t stay at these levels for the long term.
Borrowing to your maximum at this (or any) time is a recipe for disaster. Save a significant deposit – no less than 20% - and budget to make repayments at 2% above the current rates.
Better still, pay your mortgage at this higher rate from the start and build up a buffer that you can use if times get tough financially down the track.
With our busy lifestyles it’s easy to take short cuts to speed up the process. In real estate I’m finding more and more buyers are relying heavily on internet searches to find their new home or investment property. While the real estate internet sites are a good starting point they cannot replace physical inspections.
