More Sydneysiders are choosing to forgo buying in the big smoke, with regional locations in hot demand as they look to capitalise on greater affordability, according to a local buyer’s agent.
BFP Property Buyers founder and principal Ben Plohl said climbing Sydney house prices are seeing more locals explore their opportunities elsewhere, with other cities and regional areas the main benefactors.
According to Mr Plohl, the majority of would-be buyers he sees are being priced out of their preferred local suburbs, with the situation particularly prominent for those who reside in Sydney’s Lower North Shore district.
“There is no question that the Sydney property market is in a rising market phase, but the speed of the uplift is already pricing out some potential buyers,” Mr Plohl said.
“Some would-be buyers are reconsidering their options and are choosing to invest their funds in more affordable locations, such as Brisbane and Adelaide, or major regional areas like Bendigo, Orange, or even Albury and remain renting in their locations of choice.”
“Some people rent in these locations already and have decided that it’s more affordable for them to continue doing so than stretch themselves too far financially to buy at the current time,” he said.
“Wisely, they are also deciding to make their available funds still work for them by buying elsewhere.
“For example, $900,000 may not secure you much real estate on the North Shore, but it could potentially buy you two houses in a more affordable capital city or major regional location which are also experiencing strong market conditions.”
Mr Plohl’s comments coincide with 2020 findings released by PIPA’s annual investor survey, which found approximately 60 per cent of respondents would consider rentvesting as a property investment strategy. The same survey found 44 per cent of first-time investors are rentvestors, up from 34 per cent the year prior.
“Rentvesting is a sound property investment strategy for buyers who want to make the most of historically low interest rates and rising market conditions but who don’t want to sacrifice where they live to do so,” Mr Plohl said.
“With property prices rising so fast in Sydney, it can be cheaper to remain renting in most locations than buying, but that doesn’t mean buyers have to give up their property ownership dreams.
“Australia is a big country with a number of more affordable markets that are offering better bang for your buck as well as prospects for strong capital growth and rental returns over the years ahead.”
Emma Ryan, Real Estate Business, 26 March 2021