Should I buy now or later?

I am a newbie and planning to invest in property. Hearing the news RBA will increase the rate, Royal Commission will make it harder for people to get a loan, and other things happening in the world, I wonder should I invest in property now or wait?

What's the pro and con of buying now versus later?

What strategies should I use if I want to buy now in (assuming) this peak market?

Any reasons to hold, wait and see what will happen in the next 2-3 years before jumping straightaway?

Many thanks,

Ben

 

stays in the bank at the moment, hence the reason want to try putting it into property. What's your thought on the pro and con buy now or wait little bit longer? thx

 

Imo its always a good time to invest in real estate. As long as you have a sound strategy and realistic expectations . #1 is to be able undertake good due diligence. Unfortunately, imo, many haven't learnt how to.

 

Do you think property will decrease in value?
If not it might be wise to get in now before it gets even harder to qualify for finance.

 

if finance is going to harder, borrowing capacity will reduce, what will then increase the price?

 

Best time to invest is when you have the financial capacity as always. I think bigger questions are where and what. Australia have property markets in various stages of the investment cycle. Picking ones that are affordable and has room for growth is the key.

 

People who dont need to approach local banks to buy? Overseas Students studying here with rich parents. People who refinanced at least once before APRA started interrogating servicability calculators.

 

Try not to wait for 'perfect' domestic (and global) economic conditions. I've witnessed many people do this in the past and for most of them it's a form of procrastination that provides a ready made excuse not to get off the fence and do something.

Do you have the financial capacity to invest now? If so, then the reason to take action is that you could achieve capital growth over the next 2-3 years. This won't happen if you wait.

And don't be afraid to pay a licensed professional for tailored advice in relation to your specific situation.

 

Why would they pay more in an environment where competition is down? Rich parents are likely to have above average business nous, so they won't. People who refinanced might try but I doubt they will keep the prices rising either. Cash buyers might help sell properties but I'm willing to bet they will keep the prices low too.

 

Cash buyers are very minuscule fraction of total buyer at a given point in time. Like it not burrowing capacity is the key sauce in housing boom, reduce that and see magic.

Non bank lenders are next in apras radar, so it's just a matter of time before restriction hit that side of town

 

Congratulations.

I find it better not to get my investment decisions influenced by "the news".

It's up to you. What would be your trigger point for entering the market if you put this decision off into the future?

Buy now and get over your fence sitting procrastination and collect some CG &/or experience on the way through or be like the crowd and wait for better times, if they ever come????

Do some research on where it is not 'peak market' or where there are some undervalued properties in markets that are said to have peaked. Then buy something. Use the equivalent of "dollar cost averaging", and just buy regularly not trying to time the market.

Ben if you cannot buy in this market with the cheapest mortgage rates just about ever, then waiting for money to get more expensive in 2-3 years time is going to achieve your goal how??

 

are financial planners with their significant initial and ongoing fees really worth it?
do FPs have audited track records of their advice and its returns which a client can check? like active fund managers?

 

Easy money and cheap debt usually drive asset price up
people buying with cash are a tiny proportion of the market it not even register

 

Maybe, maybe not! Too many variables impacting on this.

No ...

 

Well, I might be be helping one client to maximise their Centrelink income and the next client to protect their wealth through comprehensive insurance cover. How would you like this audited and reported as an investment return?

 

is it a trick question?

 

Good reply Jane. Many people think FP is all about implementation of a strategy. Its often far more structural and the details are just part of executing it.

Many would be horrified if FPs charged a fee for the time it takes to deal with income insurance and yes they take a fee from the insurer instead. But its just nowhere near what the time cost may be. Likewise when dealing with a full plan for someone approaching retirement and there are ten + matters to plan and action (including age pension advice, granny flat issue, maybe smsf setup or other such matters) its hard to say.

Unlike MBs the world of FPs is far broader. Its important that the client ensures that any fees represent value and are competitive too. If the changes they imposed of FPs and fee disclosure were repeated for brokers clients may even be horrified in some cases just how much the upfront & trail $$$ fees are. FPs have a fee disclosure obligation that makes for regular and sometimes awkward discussion if performance is not meeting expectations.

Its like asking a builder a simple question - how much to build a house ?

Hasnt the sacked wiggle asked for his job back yet ?

 

you mean dole?