If you have tried looking for a place to rent recently, you are probably aware we have a crisis happening right now.
There is a massive shortage, with some properties attracting over 80 rental applications! Sadly, that means a lot of Australians are struggling to find somewhere to live. They are either having to live with family, in Airbnbs, or rent a place that’s far from their work and kids’ school.
You might have been wondering how rising property prices are fuelling this lack of rental availability. Usually what happens is market pressure pushes property prices up. And then, at the back of that, rentals struggle to catch up. They boom back like a rubber band.
But what’s happening at the moment is that rentals are going up at the same time as property prices. This is very rare. Normally there is always a lag during property booms.
But this property boom is proving to be quite different. Probably because it is such a major upheaval due to the unprecedented event caused by the effect that the Covid-19 pandemic has had on the world.
What The Rental Shortage Means For Property Prices
At the moment, the rent is pushing up alongside property prices. It’s a race to the top, and I don’t know what’s going to win.
The housing shortage means not only is it difficult finding somewhere to rent, but it’s even becoming difficult to find a property to buy. You will find more than 100 people on one property auction. In the end, the property sells over $100K more than the normal rate.
The annual rent increase rate in Brisbane is now 6.4%. Guess what’s going to happen? This means property prices will still continue going up.
Even still, property investors are getting tenants almost immediately. Many of my private coaching members get tenants even on the day they finish their property transactions. It’s that serious.
And if you are a property investor, congrats to you. You are doing a great job in solving this crisis.
We cannot also ignore the fact that there are Australians who are struggling at the moment. We feel you if you have been unable to get a rental property.
How To Solve The Shortage Crisis Now
Some people like to blame property investors for pushing rental prices up. But that’s not the truth. It’s property investors that keep rentals on the market – if it weren’t for us, the rental shortage would be even greater!
So the way I see it, is we need to invest more in property and help as many Australians as possible find somewhere to live.
The CBD is the only place where you can find vacant rentals. This is because the demand in the CBD is going down. But this is happening because of the COVID crisis. The majority of families don’t want to be cooped up in a box, they want room to move, a yard for the kids. The people who typically rent those inner-city apartments are immigrants and students.
But now that immmigration has ground to a halt, we have fewer international students and immigrants to tenant our CBD apartments. But something interesting is that we are still having a boom at the moment, even without the extra money that immigrants bring in.
What do you think that means? That’s right, when things come back to normal and the borders open, we will experience an even bigger property boom.
So get ready!
The Budget Brings Yet Another Opportunity For Property Investors
You probably know that the budget came out recently. The treasurer Josh Frydenberg has revealed where spending is going to go. And I’m sure that when creating this budget, the housing crisis was on the government’s mind!
I don’t know if you remember many years ago when Liberal and Labor were fighting it out. Labor decided to scrap depreciations for investors. But what would happen if you scrap depreciation for investors?
– Fewer investors buy property
– You get a rental crisis
– Rental property prices go up
– People have problems finding a place to live
Labor has been known for its long history of their love and hate relationship with negative gearing. They actually got rid of negative gearing back in the early 1990s. They fried the economy. Rentals went up. It was terrible.
So, they reintroduced it and kept quiet about it.
Now, this recent budget hasn’t changed anything about negative gearing for capital gain because they didn’t want to repeat history.
Which means it’s now even better for property investors.
The first home super saver scheme is now being revised to allow home buyers to make a withdrawal of up to 50K of the contributions. It used to be 30K, and now it’s 50K. They are trying to help people buy houses.
Then they got superannuation to downsize the scheme. Now they are expanding it to include Australians of age 60 and over. This will allow participants to make a one-time contribution of up to $30K to the super. However, you will need to be above 60 years to do that.
They were offering a $25K incentive for new homes and major innovations that was to end in April. But now, they have extended the plan to 6 months construction commencement and 18 months for applications. So, it’s going to stay with us till 2022.
Another great opportunity for real estate investors to get in NOW.
Join The Successful Property Investors Now To Solve The Rent Crisis
All that you need is a property in the top 100 suburbs in Australia that are growing in value and cost you less than $50 per week to hold. Even buying just one property now will make an enormous difference to your own financial future, AND it will give someone somewhere to live.
That’s why you need to take action now.
If you’re interested in learning more about how to set yourself up to invest in property safely and with carefully mitigated risk, I’d love to help.
My Markoski Method is a tried and tested way to profitably invest in property while protecting your income and assets at the same time. It’s part of my BlackBelt coaching program that educates and coaches members to get their first, second, third and fourth property (and beyond).
Using my method, investors buy cash flow positive properties that are actually putting money into their bank account every week.
We only work with a certain number of active members at a time, and we’re currently taking applications for the next round of new members.
If you’d like to find out more about the program, or see if we might be a good fit, get in touch with my property concierge Charmaine for a 15 minute ‘getting to know you’ call.
On the no-pressure, no-obligation call, she’ll assess where you are now, and give her honest opinion if you’re in a position where we can help you build your portfolio.
Here’s the link to Charmaine’s calendar – book a convenient time to chat now.