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To buy or to rent - That is the Question.

 

 

 

 

 

 

 

This is a question that people always ask. It is similar to the egg or chicken - What came first? #buy #rent #homeowner #homeloan #firsthomebuyer#newhome

Renting might seem more appealing with soaring housing prices in Sydney and Melbourne but don't expect it to be cheaper than buying. 
While investors have boosted the supply of rental accommodation and reduced the rate of growth of rents, rents are still growing in the two major cities, Housing Industry Association senior economist, Shane Garrett said.
Real Estate Institute of NSW president Malcolm Gunning said in many cases, "mortgage repayments are cheaper than rental".
"Take for example a one-bedroom in inner city Sydney which costs about $700,000. At about a 4 per cent fixed mortgage rate, you pay about $580 a week," he said. But rents in these areas are about $650 to $700.

So its up to you really. It is probably cheaper to buy a home in the long run but you will be tied down with a mortgage for a couple of decades. Talk to Madhu on 0425 341 086 to discuss your options and the deals available.

How negative gearing is expected to perform?

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How Negative Gearing works?

BIS Shrapnel has said the rate of property price growth in Sydney and Melbourne has slowed in 2015-16.

The report noted that national population growth in 2014/15 was at its second lowest level since 2005-06, with net overseas migration falling from 229,400 persons in 2011/12, to 176,500 persons in 2014-15.

The majority of net overseas migrations have been “long-term overseas visitors” that is, temporary but not permanent arrivals – this reduction is likely to be impact mainly the rental, and therefore apartment sector.

“As investor expectations of capital gains are reduced, investor demand is expected to weaken further, creating additional downward pressure on property prices,” he said.

BIS Shrapnel says all markets are forecast to experience falls in prices in real terms by June 2019.

Further weakness is forecast in the Perth, Darwin and Adelaide markets, with the report predicting that the Perth and Darwin markets will continue to be impacted by falling resource sector investment, weak population growth and excess supply.

Meanwhile, Adelaide is expected to continue to face economic headwinds and the closure of car manufacturing in 2017 will be a further drag on the local economy and in turn on prices.

“The real decline is forecast to be minimal at one per cent in Brisbane and Hobart, and as high as 12 per cent in Adelaide,” according to the report.

“Across the unit market, all capital cities are expected to experience greater real declines in unit prices ranging from eight per cent to 15 per cent over the three years to June 2019. With overseas buyers only able to purchase new apartments, the resale market will be more limited, being confined to local buyers.”

BIS Shrapnel forecasts the best prospects for median house price growth over the next three years are forecast to be in the Brisbane and Hobart markets, followed by Canberra.

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