Getting an accurate read on the property market can be difficult. The messages pushed through the media by vested interest often contradicts. Many forecasts, projections and trends are used to justify ones case high or low. One day it seems there is a severe shortage of dwellings and then the next we are warned of oversupply.
The banks and the property industry are issuing reports and research that suggest prices are sustainable if interest rates stay at the current record low levels. That’s a huge ‘if” when you consider that the term of a mortgage is 25 years.
When buying, it’s crucial that you accept prices can go up AND down. The market is experiencing very strong price growth that makes current selling conditions very favourable. Real estate is a great investment long term. It is not a great investment if you overpay when rates are low and THEN forced to sell in a falling market.
Just because a suburb has experienced strong growth in the past 12 months does not mean that growth will be repeated. Savvy investors know this is a great environment to sell rather than buy.