Don’t Panic about Property (or interest rates for that matter)

7 October 2022, 12:03 am

Recent media reports would have you believe that armageddon was on us when it comes to interest rates.

But look back just a few short years ago to around 2010-2011 and interest rates were hovering around the 7.0 to 7.5 range. Yet the investment market was buoyant and property volumes quite high.

Property is a long-term game.

The reason we chose the 2010-2011 period to compare to today’s market is that various researchers suggest that property prices will double every seven to ten years – depending on the location. Looking back a decade and seeing that interest rates were at a similar level should give you confidence that indeed we do see cycles of rates being a little lower or a little higher.

Of course, your individual affordability – what you can borrow – will rely on your income and other factors. And a higher interest rate can affect the total amount you can borrow.

But remember that it is an investment and one that has a history of growing pretty strongly in Australia. You can’t guarantee the future based on the past, but the evidence is the value of your investment is likely to grow and using some bank debt is a pretty low-risk way of generating some good capital growth.

Our team of experienced advisers can discuss your individual circumstances with you. We can help you plan out what investments are right for you. And our team of senior mortgage advisers can then negotiate the best possible deal on any money you do borrow.

Here are three simple tips when preparing your goals around property investment from Stuart Lavender.

Tip 1

Purchasing property is all about managing cash flow. It is important to purchase a property that is going to be easily managed from a cash flow perspective. Ideally, the return needs to be around 4% to 5% otherwise it will put a lot of stress on the family budget and cause upset in the family household.

Tip 2

it is important to purchase property in areas where you can see how it will go up in value over time ie changes in demographics, changes in infrastructure like schools and shopping complexes and employment opportunities.

Tip 3

Time in the market, not the time you get into the market. It is impossible to time the market so if you can, you should invest. Someone once said, “the best time to buy Real Estate was 20 years ago the next best is today or when you can financially afford to do so”.

Tip 4

There will be times when you want to change direction and do something else as this may seem too hard at times. You must ride through the challenging times to have success sometimes. You should stay the course to achieve your financial freedom.

In summary, we counsel you to remain calm and make a plan. Don’t listen to the media with their overinflated and hyped-up hysteria.

Make your plans, get expert advice where needed, and you will be ok.

Call our team on (03) 9017 3235 for more information or email us at to organise a no-obligation discussion on your property investment goals.