Landlords Face Some Challenging Conditions
Landlords have enjoyed consistent price growth over the past decade. Admittedly the growth was coming off a very low base compared to the value of the investment property. Now as record low interest rates and mass construction of home units make buying more affordable, many tenants are abandoning the rental market.
For a long time it has been cheaper to rent than buy. But with mortgage rates sitting at 5%, a buyer with a $50,000 deposit on a $550,000 apartment would face repayments of $500 per week. That same apartment may cost somewhere between $550 and $600 per week to lease, making buying an appealing option for many.