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Should share market investors turn to property?

By | Market View | No Comments

In the wake of the recent shift in the ASX is the time right to take up property investing?

During the downturn of the 1987 market crash (and to a lesser extent the 2008 crisis), bricks and mortar still performed quite well. Whilst there were losses in terms of capital value during both these periods, they were smaller with property than with shares. Further it seems as though there is much less volatility with property than the erratic nature of the share market.

Melbourne Metro vacancy rates are currently sitting at 3% with the median rental price just over $400 per week according to the REIV’s latest report. This presents opportunity if quality property is available.

Now we do not assume we can predict the future of property prices, but if history is anything to go by, no matter how many downturns there have been in property, over time if bought and sold well there is money to be made. This is equally as true in shares, but unless you are dealing with shares on regular basis, you are safer passively investing in property than the far more risky business of the share market.

Over the long term, purchasing a property in the right location is nearly fool proof, even if for example the market drops 10-20% in the short term. Equally however with ever increasing immigration, an insatiable thirst of international investors for quality property there is every chance that it could go the other way and higher.

With a need for quality family homes in the rental market this could be an ideal time to begin investing in property.

To assist with any of your property needs, please feel free to get in contact with us.