One of the questions many people have recently is: “Is it too late for me to invest in real estate in Melbourne”? Are apartments too small to appreciate?” To better understand the situation in Australia’s second-largest real estate market, people who invest in Melbourne real estate have a clearer understanding. This article is designed to give you a detailed explanation of the six most frequently asked questions of real estate investment in Melbourne.
1. What infrastructure is being built near the property I want to buy?
You can visit the website www.infrastructureaustralia.gov.au to find out what is being built or planned in the vicinity. This site contains links to all infrastructure planning departments. Take the current Melbourne investment hotspots Point Cook and Tarneit as an example. Melbourne’s current top priority projects are basically road widening construction in the direction of the Western District. It can be seen that Melbourne has placed the Western District Reconstruction Plan on top priority. Everyone understands that “To create wealth, you must build the road first”, it is inferred that the real estate in southwest Melbourne will be the best investment option.
2. What is happening in the local market?
What is happening in the local area will have a positive direct impact on the real estate market. The best way to understand the local situation is to see it happening in person. Learn about the local business district, look at the style of local businesses, and assess whether the local middle class is already there. You can also go to the Australian Bureau of Statistics website www.abs.gov.au to view local demographic data and employment rates. Taking the example of Point Cook, Melbourne’s most recent investment hotspot in the West. According to the website data, Melbourne’s West Side is the most populated area in Melbourne, with an increase of 22,700 in just one year, far more than 17,400 in Melbourne’s inner city. At the same time, Melbourne’s fastest growing population has reached 3.3%. Point Cook’s population growth rate is 8.7%. The rapid increase in population proves that there will be an increasing demand for houses in this area, so as to see the value-added possibilities of real estate in this area.
3. How is the house rental return potential?
If an investment advisor tells you that a week's rent for a property is AUD $400, be aware that this does not always mean that the property will certainly receive this and that, this is usually an estimate. Investors can use Domain Network and Real estate Network to check the rent of similar local houses, or ask independent agencies to do rent evaluation. The rental price of a property is often an estimate and always is some deviations, but the estimation of rent can help investors get a more accurate valuation. 4. What is a competitive market? If there are too many investors in a market, this will often reduces rental returns; this will also cause a decrease with asset appreciation. Investors can contact the local government to find out how many homes there are in an area. Investors need to pay attention to those areas that have a large number of investment properties. If investors make up a large part of the market, this will cause competition in the rental market and will cause increased competition if they try to sell their property.
5. How is the status of the real estate fee?
Investors who purchase a apartment are required to outlay fees for body corporate council and water rates a annually. These fees are deposited into a sinking fund to cover the maintenance costs of elevators, floors, and carpets. As well as pay agent management fees which usually run at about 6~7% of the monthly rental.
6. How is the value of a property estimated?
The price of a property is often not necessarily its real value, but an estimate. Investors can apply for property valuation to ascertain the current value of a property from a sworn valuer. Melbourne’s current housing market shows that apartment projects often estimate 30% lower than the sale price, so when making a loan, valuations are often lower than the selling price. Investors often have to prepare more cash. The reason for it is that the value of the land that he maintains, and the valuation of the loan can basically estimate the selling price. Therefore, before buying a house, an independent, certified appraiser is commissioned to assess the value of the house, which can be used to simply prove whether the investment house is worthwhile and reduce investment risks. What needs to be noted here is that we must choose a professional institution.
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