Growing property values highlight opportunities

Growing property values highlight opportunities

Following the Reserve Bank of Australia's retention of the official cash rate at 2.5 per cent, now could be the perfect time to consider taking out a home mortgage and moving into the nation's property market. In fact, taking the time to consider real estate investment could be a lucrative avenue to investigate.

The latest release from RP Data has illustrated the rising strength of Australia's capital city real estate markets. Over the last 12 months, combined capital city values have grown by 10.1 per cent, and are expected to continue growing well into the future. Taking the time to look into your home loan interest rate options before considering investment properties will help you adequately plan your wealth generation in the coming years.

RP Data Research Director Tim Lawless said the value accumulation across these properties has slowed down following the explosive period seen earlier this year, moving into a more sustainable, long-term level. This could offer a degree of confidence to first-time investors, especially if you're interested in purchasing multiple properties from the start.

"Looking through the monthly movements, the trend in performance is much more important. It shows that the quarterly rate of growth peaked across the Australian housing market in August last year at 4 per cent. Since that time the rate of capital gain has generally trended towards a more sustainable level," said Mr Lawless in a July 1 statement.

"Activity across RP Data valuation platforms has also held firm at relatively high levels suggesting mortgage demand isn't dropping off just yet. With interest rates remaining low for the foreseeable future, it is doubtful that housing values will start to slide, at least not at a macro level."

This could present a number of opportunities for smart buyers in the coming years, especially with the population expected to continue rising in the near future. 

Image credit: Daniel Lee

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