REIWA Provides the Lowdown On The Real Deal for Residential Real Estate in 2015

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Will there be an upward or downward trajectory, or will the situation remain similar to the previous year’s? REIWA lays down the current situation and what people can expect in the upcoming months.

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...instead of relying solely on news reports regarding how the industry is likely to perform, it’s better to have a more in-depth understanding of the climate of the specific market you’re targeting.

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The considerably positive climate within the real estate industry during the last quarter of 2014 is believed to have lingering effects, and real estate authorities are expecting the momentum set the previous year to spawn other benefits for the property industry. A report by news.com.au published Dec 25, 2014 claims residential property rates are going to decrease by the start of the second quarter of the year (http://www.news.com.au/finance/money/property-prices-what-to-expect-from-real-estate-in-2015/story-e6frfmdr-1227166117159), and more so in the following months. With all these projections, indeed, it appears to be an ideal time to invest.

The Real Estate Institute of Western Australia or REIWA believes it’s always good to be optimistic, but it’s important to be aware of other elements surrounding the industry that may have a direct impact on property prices, such as the negative gearing law which real estate experts believe could serve as a hindrance, as reported by the International Business Times on Dec 11, 2014 (http://au.ibtimes.com/articles/575586/20141211/buying-house-australia-rent-law-cheaper.htm#.VKt6TSuUeBC). For many who are not aware or have no clue what it’s about, negative gearing is “a system that will allow an investor who is paying more in terms of mortgage interest compared to the rental income of that property, to off that loss against other taxable income.” This may prove favourable to investors, but it can also mean that residential rental/lease rates could rise.

Another variable to consider is the increase in supply of new residential provisions, which is believed to be prompted by the growing population of the country (largely due to immigrants, foreign workers and students). The abundant supply can lead to slower real estate price growth which is beneficial for investors, but perhaps the opposite for developers.

There truly are numerous components to consider, and for those who are thinking that 2015 is going to be a fantastic year for the real estate industry, and that it’s the perfect time to move to an upscale neighbourhood or finally purchase a home, the real deal is that it may or may not be. More often than not, projections or predictions are truly just mere hopes that everything will pan out well.

According to a representative of REIWA, instead of relying solely on news reports regarding how the industry is likely to perform, it’s better to have a more in-depth understanding of the climate of the specific market you’re targeting. The most important data required to make a sound decision for investing in a residential property can best be provided by a fully qualified and highly experienced property agent. Such a professional has a wealth of insider knowledge of the actual market conditions in the community that buyers are keeping their eyes out for, as well as the various provisions that buyers can qualify for so they can effectively and efficiently finance the purchase. And lastly, they provide the buyers information that is pertinent to the residential properties they are considering to buy, such as plans of development within the area, homeowners’ association or committee fees/responsibilities, and many others.

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