Australia’s most comprehensive snapshot of the nation’s property investor community, the 2019 PIPA (Property Investment Professionals of Australia) Annual Property Investor Sentiment Survey is now out.

This survey is a rare and detailed portrait of Australia’s residential property investors and how they think. It has revealed investors remain upbeat about property in 2019 and are more positive about the market compared to the same time last year – despite slower markets in Sydney and Melbourne and a relatively tight financial environment.

The politics of investment

The survey found Labor’s proposed changes to negative gearing and Capital Gains Tax legislation heavily influenced the way that three quarters of investors voted in the recent Federal Election, despite short-term tax benefits being the least important criteria in investment property selection in this year’s survey results.

“It’s clear that many investors, regardless of their political leanings, were fed up with being told they were ‘greedy’ when the vast majority only own property and are just trying to improve their financial futures,” PIPA Chairman Peter Koulizos said.

Investor concerns

Difficulty obtaining finance, as well as the popularity of banks being on the slide over the past year, meant that about 59 % of investors are now more likely to consider a non-major bank lender, especially after the outcomes of last year’s Banking Royal Commission.

Over the past year, the survey found that 27 % of investors had secured a loan from a non-major bank lender with the top two reasons being cheaper interest rates and increasing borrowing power.

In fact, the survey found that the two biggest concerns for investors were gaining access to lending and Australian economic conditions.

Legislation is also having an impact on landlords, too, with more than four in five investors indicating they would pass on increased costs to tenants resulting from any potential changes to State and Territory tenancy laws.

A focus on the long-term merits of real estate

Some 78 % of respondents said concerns about potential falling house prices wouldn’t cause them to put investment plans on hold.

Indeed, about 82 % of investors believe that now is a good time to invest in residential property, which is up from 77 % in 2018.

“Long-term capital growth beat out cash flow – both long- and short-term – as the most important aspect when choosing an investment,” Mr Koulizos said.

“Property investors are just trying to looking their lot because when asked why they choose to invest, the most important reason was to provide a better life financially for themselves and their family, while the idea of ‘becoming rich’ was one of the least important reasons.”

What are investors looking for?

The number of investors looking to buy existing stock continues to be high at 91 %, with 71 % saying they intended to buy a house in the next 12 months.

The number of investors looking at off-the-plan units or house and land packages sits at 5 %, which is down from 6.4 % in 2018.

About 48 % of investors are looking to purchase a property in the next 6 to 12 months.

You can find out more about this property survey and download it for yourself at https://pipa.asn.au/property-policies-swayed-investor-votes-with-many-now-also-considering-non-bank-lenders-pipa-national-investor-survey/

With 40 years in the business, we’ve helped hundreds of investors realise their financial dreams through property and we’re always looking out to get the best from your investment. Contact us on 02 4956 9777, send us an email to mail@newcastlepropertymanagement.com.au or pop into our Cardiff office for a chat.

For more property management tips check out our Facebook page: www.facebook.com/NewcastlePropertyManagement