There are two types of sub-markets in Real Estate that are vulnerable in a fluctuating market.

These markets can look like very sound investments on paper but they can present significant risks for property investors in an unstable market:

• Off Plan Apartments

 Most  “Off Plan Apartments “ are valued at considerably less than the contract price upon their completion. Banks tend to be more reluctant to lend as much for this type of investment and often, there will be hundreds of identical apartments listed simultaneously, which potentially lowers their value.

• House & Land Packages

House and Land Packages, just like “Off Plan Apartments”, can fall in value during construction, leaving buyers with a shortfall. With this type of investment, you will be relying solely on the market going up to gain capital, which is unlikely because of the interest rate sensitive demographic, who buy into this market.

The safest option in an unstable market is to buy established houses, townhouses or apartments in inner or middle ring suburbs in a capital city, that have foundational growth factors that are mostly absent in off the plan markets.

Established properties have these essential pillars of growth:

• Established Infrastructure and transport
• Proximity to commercial centres
• Ability to purchase at fair market value
• Option to manufacture growth through improvements

• Use RealRenta for Free for up to 2 months and see how easy it is to increase the Return on your Investment

• You will never have to pay a Property Manager again!