Got big ideas about entering into the property market or expanding your property investment portfolio? Sometimes thinking bigger means buying smaller. Here’s 5 reasons more and more savvy investors are making the switch to 1 or 2 bedroom houses in Perth:
- GOOD ENTRY POINT / PORTFOLIO EXPANSION. A smaller property such as an Infill property costs less to purchase (smaller capital outlay), enabling first time investors to enter the market in locations they might not otherwise be able to afford. At the other end of the spectrum, seasoned investors know one of the keys to success is diversity of property types. A small house makes a cost effective addition to any portfolio.
- LOCATION, LOCATION, LOCATION. Smaller properties in desirable locations enjoy superior capital growth compared to bigger properties (of equivalent market value) situated further away from infrastructure such as schools and public transport etc.
- SUPPLY & DEMAND. Economists have forecast an unprecedented spike in demand for apartments in Perth over the next 10 years (Urbis Property Report 2015). This is due to factors like immigration, higher house prices, a shortage of land, and Gen-Y’s urban lifestyle values. This trend has already manifested in the Eastern States, and WA is quickly following suit.
- LOW MAINTENANCE. A smaller building and outdoor area means less gardening, fencing, reticulation, walls to paint, floors to cover and the list goes on.
- TAX BENEFITS. Your new house on a small block has a higher rate of depreciation compared to an older house on a bigger block, and the tax deductions ultimately result in a more positive cash flow.
To find out more detail about why small investment properties are trending with investors, chat to PEB Invest today.
*This article is for general information purposes only. It is not intended as financial or investment advice and should not be construed or relied on as such. Before making any commitment of a financial nature you should seek advice from a qualified and registered financial or investment adviser.
PEB Group is a complete property advisory service for Perth families. Offices are located in Inglewood and Willetton, Perth, Western Australia and offer service in - Financial Planning · Finance Broking · Property Management · Property Sales · Property Investment · Development
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