Is Now The Time To Buy Real Estate?

 In Investing

This is a hard subject to write on objectively…not because I am a Real Estate Agent, but because I am a bit of a control freak, and like to be able to see, touch and manage my assets, if, when and how I want to do so. Not only is this of great importance to me, but also knowing it is an investment that someone else is willing and happy to pay off for me… that is unusual in the world of investments!Now, having said that, and in the interests of giving a balanced view, I must admit that it’s not completely straightforward, or devoid of costs, which can at times put a big dent in the viability of the asset. The most common of these are the Stamp Duty it costs to procure the property in the first place, Strata fees if you are buying a strata property, maintenance costs, insurance, property management fees and of course the dreaded land tax… not to mention Capital Gains Tax when you DO make a profit… aaaagh! Is there no end to it? Here we are in ‘The Land of Plenty“ where you can make money… you just can’t keep it!

Bearing all that in mind there are also some very big plusses… capital gains being the biggest of these, but how do you know when this will occur…? The truth is you can ponder and hypothesise over this forever (especially in these unusual times when nobody really knows who’s in charge and who’s making the rules) but nobody knows this for certain. The one consistent truth that you CAN rely on, is that property always goes up over time…yes ALWAYS, so, at the end of the day, the sooner you buy property, the better.

There will of course be ‘ebbs and flows’ and fits and starts’ in the property market but if you hold out for the long term, you will always end up ahead. The other attractive thing about property, is that whatever happens to the market… dare I say it…You will “all be in it together“ so it won’t affect your buying power within the property market, unlike in the share market where your shares can plummet, and everyone else’s takes off… now THAT would be upsetting! So, for those of you still wondering if it’s a good time to buy property, my answer is… it’s not a BAD time. It’s NEVER a bad time, unless you are not prepared or can’t afford it.

Now WHAT SORT of property you are going to buy really IS important. Buying a house with land in a sought-after location is the cream of the crop. Land is the ultimate gold standard in the buying of property. This is because it is finite…
there is only so much of it, and it is always going to be desired…especially if it’s in a prime spot. Anything that is rare or becoming rare is the best investment ever, which is why I love vintage cars… they are just not made anymore and therefore soar in value. It’s the same with character homes, or homes with potential to improve, or vacant land where you can create a masterpiece. So, anything with land, in the long term will serve you well but the further you are away from the city, or a ‘hot spot” like, say Margaret River, the longer it will take and the slower it will grow.

So… if you have lazy money right now, or a tax problem, I still recommend real estate. Other options include leaving money in the bank, which currently returns virtually nothing, causing it to reduce in value as the cost of living goes up. Then there is buying shares which, if you know what you are doing can be quite lucrative and does avoid many of the costs associated with property, but with takeovers and share dilutions, I have not had much joy here. However, if you go with Blue Chip shares you can feel pretty secure, even though it’s a bit of a ‘slow plod’ to the finish line.

Otherwise, there are gold bars, for people who like to stash money under the bed, but in a smart way, and lastly Crypto Currency which I have no idea about. So, at the end of the day, I am still loving property as a solid, secure tangible asset and… at least you will always know you have a roof over your head!

Source: “Is Now The Time To Buy Real Estate”, The Post – 26 March 2022

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