Factors to Consider for Property Investment in Sydney

Because Sydney is a dynamic and thriving global city, it has earned a reputation for being an expensive place in which to buy real estate. However, it is also widely understood that properties in Sydney tend to appreciate in value and over time, represent a sound financial investment.

There are a number of factors that a person should consider when buying an investment property.Sydney real estate brings particular advantages and challenges which are very useful to know when contemplating or being committed to expanding your property portfolio.

Here we take a look at six things that are useful to know when buying an investment property in Sydney:

1:  A piece of very good news for property investors is that demand for rental properties in Sydney has historically been, and continues to be, strong. Quality properties in favourable locations are in hot demand and competition for such properties can be fierce amongst good quality tenants. Essentially, this means that a good quality property will attract good quality tenants and will bring in good rental returns.

2:  Predictions show that high rental demand is expected to continue in Sydney. The state’s population is growing and there is an extreme shortage of rental properties in both the Sydney and broader New South Wales property markets.

3:  Despite increases in the population of New South Wales in the last ten years, there has not been a similar increase in the rate of new homes being built. For property investors, this is good news as it affirms the all but certain ongoing demand for rental properties.

4:  It is estimated that by 2031, the population of New South Wales will increase to 5.3 million people and this will require in excess of six hundred thousand new homes to be created. Many of these homes are earmarked for building in established suburbs (that are characterised by shops and services being within walking distance) and the CBD. Homes in such locations are bound to appeal to, and be profitable for, property investors.

5:  Developments in infrastructure, including freeways and link roads in Sydney, make it possible for people to more easily travel within and across the city and metropolitan areas. Not only do such developments enhance the ways that people travel, they also have an effect on property prices and the demand for rental properties, given that different areas can be more easily accessed.

6:  For people that are committed to buying in Sydney, it is important to be aware of the suburbs that are up and coming as well as the areas that consistently have a favourable rental yield. As is currently the case, suburbs that are positioned within ten to twelve kilometres of the CBD, suburbs near water and those that are perennially popular with renters are likely to always show good results on an investment. However, for these same reasons, property prices in such areas of Sydney are often already high when compared to levels of investment in other Australian cities.

Investing in property in Sydney offers many potential advantages and gains but it also presents a variety of issues that need to be carefully considered by astute investors. While many attractive and appealing financial gains may be made, it is incredibly important to seek sound and well-informed property investment advice and make considered decisions according to the location and property type that you wish to purchase, as well as the funds you have available and the likely returns on your investment.

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