Here’s how Coronavirus and the recession has impacted these property investors

Here’s how Coronavirus and the recession has impacted these property investors

Has the coronavirus induced recession affected you?

Are you considering moving to live in a different location because of COVID-19?

Has the pandemic changed your strategy or approach to property investing?

These are some of the Covid-19 related questions we recently asked 1,500 Australian property investors and would be investors in our annual Property Investment Sentiment Survey, and some of the answers were enlightening.

Running since 2011, our survey offers rich and vibrant insights into how property consumer trends and sentiments have changed over time.

A surprising result this year was that more respondents (74%) believe this a great time to invest.

50% are planning to buy an investment property and 24% are hoping to buy a new home in 2021.

You can download the full survey findings by clicking here, but for the moment let’s look at some of the highlights related to Covid 19.

Do you believe now is a good time to invest in residential property?

Respondents to the survey saw this as the best time to invest in property for a long time, with 74% believing now is a good time to invest.

This figure is up significantly from 68% in 2019, 52% in 2018 and 59% in 2017.

50% of respondents said they were planning to buy an investment property in the next year (up from 42% last year.)

However, investors are cautious about our property markets.

  • 45% of respondents see property values rising in the next year.
  • Last year 61% of respondents thought property values would rise in 2020, while the year before 84% of respondents expected property values to fall over the coming year. Interestingly they were wrong each time.

What Will Happen To Property Values

 

Has the pandemic changed your strategy or approach to property investing?

 

While a quarter of the respondents were a little more cautious due to the current economic climate, the vast majority of investors (65%) are not changing their approach to property investment.

Has The Pandemic Changed Your Investment Strategy

Has the pandemic impacted your immediate investment plans in the next 12 months?

While 20% are pausing the investment plans until the situation became clearer, the majority of respondents are not going to change their plans and 14% are going to take advantage of the current climate to enter the market sooner.

In fact, 50% of the respondents were planning to buy an investment property in the next 12 months – this was the highest percentage in this annual survey over the last five years.

Has The Pandemic Impacted Your Immediate Investment Plans

What Will Happen To Property Values

What type of property are you planning to buy?

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Clearly off the plan properties are out of favour with respondents keen to buy established properties, and in particular those with the ability to add value through renovation or development.

What Type Of Property Are You Planning To Buy?

Only 10% of respondents said they had applied for a mortgage repayment holiday for either their home or investment properties because of Covid 19.

Have You Asked For A Mortgage Holiday

However, one quarter of the respondents had received a request for a rental reduction or holiday because of COVID-19 from the tenants

Have Your Tenants Asked For Rental Relief

Are you considering moving to live in a different location because of COVID-19?

When asked whether they were considering moving to live in a different location because of COVID-19, 90% have no plans to move end of the others, only 2% considered moving to regional Australia, with Queensland being the most popular destination to make a new home.

 

Have You Considered Moving

Those looking to move elsewhere were looking for a better lifestyle.

Why would you move

The Bottom Line

The fact that respondents to this survey already subscribed to Property Update or Your Investment Property Magazine meant they were a captive audience of people already interested in property.

Rentvesting

When asked for their combined family income 2% earned less than $50,000 while 35% earned more than $200,000 but the bulk earned a combined family income between $100,000 and $200,000.

88% owned at least one investment property, but a wide spectrum of investors partook in the survey:

  • 12% owned no investments
  • 20% owned one investment property
  • 19% owned two investment properties
  • 13% owned three investment properties, and it went all the way up to
  • 5% owning 10 or more properties

And clearly, these investors took a long-term view and 74% felt that now is a good time to get involved in the property market, with 50% planning to buy an investment property in the next year (up from 42% last year) and 24% planning to buy a new home in 2021.

In previous surveys, this figure has been 20% for the last 3 years.

Our survey shows that Australian property investors focus on long-term capital growth, rather than cash flow and many are looking for a property that has the potential to add value, rather than waiting for the market to do the heavy lifting.

Investors will still face a number of hurdles with the economic challenges facing Australia, yet few have changed their long-term plans due to COVID-19.

Now is the time to take action and set yourself for the opportunities that will present themselves as the market moves on

Metropole

A perfect storm is brewing for our property markets in 2021-22, an you can trust the team at Metropole to provide you with directionguidance and results.

In challenging times like we are currently experiencing you need an advisor who takes a holistic approach to your wealth creation and that’s what you exactly what you get from the multi award winning team at Metropole.

If you’re looking at buying your next home or investment property here’s 4 ways we can help you:

  1. Strategic property advice. – Allow us to build a Strategic Property Plan for you and your family.  Planning is bringing the future into the present so you can do something about it now!  This will give you direction, results and more certainty. Click here to learn more
  2. Buyer’s agency – As Australia’s most trusted buyers’ agents we’ve been involved in over $3Billion worth of transactions creating wealth for our clients and we can do the same for you. Our on the ground teams in Melbourne, Sydney and Brisbane bring you years of experience and perspective – that’s something money just can’t buy. We’ll help you find your next home or an investment grade property.  Click here to learn how we can help you.
  3. Wealth Advisory – We can provide you with strategic tailored financial planning and wealth advice. Click here to learn more about we can help you.
  4. Property Management – Our stress free property management services help you maximise your property returns. Click here to find out why our clients enjoy a vacancy rate considerably below the market average, our tenants stay an average of 3 years and our properties lease 10 days faster than the market average.

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