Coffs Coast investors expected to buy
THE Coffs Coast property market could see an uplift in six weeks when the Australian Prudential Regulation Authority (APRA) will scrap its housing investor loan cap.
The loan cap was imposed in 2014 when a limit was set on investor lending growth of no more than 10per cent. It was a measure designed to cool the Sydney and Melbourne housing markets, but The Edge Coffs Harbour principal Mark Webb said the change did have an effect on the Coffs Harbour market.
"It was hard for clients to access money for investment so it had a bit of a impact on people purchasing, but overall the local market remained strong and performed well,” he said.
Now, believing the job has been done, APRA will discontinue the cap as of July 1.
"There has been a clear reduction in higher risk lending, with investor loan growth moderating, interest-only lending declining and high loan-to-valuation lending also markedly lower,” APRA chairman Wayne Byres said.
"There have also been improvements in lending policies, increasing the rigour of serviceability assessments for new borrowers.”
Mr Webb said the change was going to make a big difference on the Coffs Coast and the market was ready for the change.
"I think investors will get back into the market and the banks will be keen to lend more,” he said.
"Prices and consumer confidence are there, so I think we should see some good price growth in the near future.”
PROPERTY INVESTMENT TIPS:
If you're a first time investor it can be hard to know where to start, but the best place to start is with plenty of research.
You need to have a real understanding of what is involved in property investing, so get some financial advice before you even consider looking at houses or units.
You need to look at your tax situation and decide if you want a property that will be negatively geared. You may want to have cash-flow from day one with a positively geared property, or perhaps you like your DIY and want to flip a property.
Once you know your plan and budget, then you can start looking at where you want to invest.
There are plenty of good investment options on the Coffs Coast, however, because you won't be living in the property, your investment could be anywhere.
Look for areas with a strong local economy and suburbs that are in high demand with renters, but also have a low vacancy rate.
Think about what type of property will attract tenants and ideally give you solid price growth into the future.
If it all sounds daunting, get in touch with several real estate agents and ask their advice and if they have any properties that suit your requirements. Agents will have plenty of local insights and a feel for where the market is going.