Many Australians have been wondering lately what to do about real estate investments in light of the recent worldwide economic mess. The market is fluctuating daily and no one is able to accurately predict what will happen next with the sharemarkets. The economic crisis has affected many Australians who now face tough decisions. What should be done about real estate investing?

Experts have not been able to come to a general consensus in regards to property. Some experts are predicting dire circumstances in the future with a 40 percent fall in process over the next few years. Other experts seem to think that due to the housing shortage in Australia and the government incentives being offered, most Australians should be able to get by unscathed if the economic fallout lands on the shores of Australia.

If you are someone who is considering venturing into the world of real estate investing there are a few things to consider.

Don’t Get Crazy

If you plan on doing some investing make sure that you are investing smart. That means to nix any ideas of purchasing exotic location investments such as ocean front villas and the like. Those types of areas are usually the first ones to suffer during an economic slump. You want to make sure that the area where you purchase is a necessity and can withstand any economic disaster. When it comes down to crunch time and people are strapped for cash they will offload their vacation homes and exotic location homes first. That will leave you in a swamped market and bring your property value down. Instead of looking at “glamorous” places to invest stick to the basics and try some of these suggestions:

• Look for homes that fall into the lower third of the market. These homes have had a good track record of retaining value and being dependable in a financial crisis. These types of homes are also more attractive for renters and can be a great owner-occupied sort of situation.

• If you’re looking for a good investment and don’t have a lot of money to start homes in the lower third of the market tend to be a lot more affordable and easy to manage for a first time investor or small time operation.

In the next installment we will explore some more principals to help you with making smart choices for investing in real estate in this uncertain market.

Sean Rasmussen
Property Options Australia
Property Options Blog © 2006 - 2008

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The Australia New Home Owner Grant scheme was introduced on 1 July 2000 to help offset the effect of the GST on home ownership. This scheme was set forth nation wide and was funded independently by the states and territories and administered under their own individual legislation. The First Home Owner Grant initially gave a one time grant payment of up to $7000 to first time home buyers who were eligible to receive the benefit in order to help stimulate the housing market and promote home ownership.

The Australian Government recently announced a First Home Owner Boost to help supplement the States and Territories funded First Home Owner Grant Scheme. With the new boost first time home owners who purchase homes that are already in existence will receive an additional $7000 bringing the total amount of support from the grant up to $14,000. In addition to that first time home owners who build a new home will receive a bonus of $14,000 making their total grant allowance $21,000.

The increase in the Federal Government’s First Home Owner Grant has provided that extra push needed to get some Australians out of their rentals and into a home of their own. The Government’s offer expires on June 30 of 2009 so first time home buyers will need to act fast in order to take advantage of the higher rates being paid out.

Some Australians who plan to use the First Home Owner Grant stated that the extra money will help out with expenses such as settlement costs and relocation fees. Having that extra money to depend on is a pretty big incentive to purchase a home for the first time. While most Australians said that the extra money will not affect the price of the home they buy, all did seem to agree that having that extra money offered is a real incentive to purchasing their own home.

Sean Rasmussen
Property Options Australia
Property Options Blog © 2006 - 2008

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