Should I Buy An Australian Investment Property In 2021?

Should I Buy An Australian Investment Property In 2021?

. 5 min read

If you work in real estate, you are probably getting a lot of questions from friends and acquaintances about whether 2021 is a good time to invest in Australian property. The Australian property market has been shown to be very strong this year and is showing no sign of stopping.

Unfortunately, the effects of the COVID-19 global pandemic are also ongoing, and the virus definitely isn’t disappearing any time soon, so it’s difficult to predict exactly what the coming years will look like for the Australian economy. So, if you’re in a position to be able to afford to invest in Australian real estate in 2021, how do you know if it’s the right time?

The global COVID-19 pandemic has resulted in many people spending more time at home, for recreation, as well as for work. This has caused many households to re-evaluate what’s important in their living arrangements. The desire for more space has increased and the importance of living close to the city has in many cases decreased.

Having space within a home design has arguably become much more desirable and, specifically, a workspace has become a really important space in a home for many people. Australians looking to buy property will now put more value on having a home office space or even a study nook within the home’s design than they would have before the pandemic.

In short, one effect that the COVID-19 pandemic has had is that we are finding ourselves stuck at home and we are simultaneously realizing that in many cases our homes are not quite what we want.

It’s worth noting that if you’re considering investing in real estate without knowledge of it, it’s important to ensure that you have expert assistance available and that you are prepared and supported through the buying process.

Of course, not everyone will have the necessary knowledge of all the legalities and other aspects of real estate. But consulting with conveyancing agents may shed more light on these. Contacting a reputable conveyancer with years of experience in the market will give insight into many of the issues new buyers frequently encounter.

Real estate sales can, fortunately, continue during situations when the government has imposed a lockdown or restrictions due to rising COVID-19 cases, however, this may mean delays and may restrict viewings of properties.

Fortunately, the conveyancing process is able to continue fairly easier in locked down circumstances with various online platforms. An experienced conveyancer can help clients to complete the legal requirements that are a necessary part of buying real estate, even during strict lockdown periods.

Property investment is generally seen as a great way to build wealth in Australia and, with real estate markets across Melbourne and Brisbane flourishing in 2021, now is looking like a great time to get involved and reap the financial rewards! It’s important to do some solid research before embarking on buying property, but here are some reasons why 2021 is a great time to invest in Australian real estate.

Record low-interest rates and attractive government incentives

Despite the challenges of living during a global pandemic, 2021 has seen a significant increase in Australians looking to invest in real estate. With national trends showing steady long-term growth and record low-interest rates, it's a great time to invest. 2020 saw the Australian property market dip, but prices have rebounded stronger than ever.

Australian government incentives such as the First Home Loan Deposit Scheme and Home Builder are helping eligible potential home buyers and investors to get involved in the real estate market. Property investment allows buyers to claim several tax benefits, such as a tax reduction if the value of your investment property depreciates. The record-low interest rates also mean that it is easier and cheaper to pay off a real estate purchase.

Potential for future growth

One of the best things about investing in the Australian property market is the steady long-term growth that it consistently generates. Property is generally seen as a fairly low-risk investment provided that you are financially able and prepared to wait for land values to increase. It’s important to do some thorough research before you buy, seek expert advice and be prepared to wait to see long-term gains.

Here are some points to consider when choosing a property to buy as an investment:

  • Invest in an area that you know, or thoroughly research the area that you plan to invest in. The more information one can gather about the area, the more comfortable one can decide later.
  • Choose a property in an area that is showing significant growth in terms of economy, local infrastructure and population. Sometimes areas seem to be growing well, but this growth is not sustainable for the foreseeable future. Speak to the local real estate agents to find more information on a specific area.
  • Be careful not to overspend, and research rental yield trends in the area that you are considering buying in. Spending too much on the initial buying price will increase the bond on the home and reduce the expected profit from the rental.
  • Try to choose a property located in an area with low rental vacancy rates. The rental vacancies of an area will indicate whether many people are looking to rent a property or not. If not, the property will not be a good investment to put into the market as a rental property.
  • Don’t forget to take into account any government or council plans for the area, such as residential developments and shopping hubs or other amenities. Some developments could increase the value of a property, while others may cause a decline in the rental market. It is best to consult the council for their projected outcome of the property value after completion.
  • Always try to choose a property that will be low maintenance and is preferably ready to rent out straight away. If there are some renovations to do or the building is in a bad state, extra expenses will cause a loss of profit.
  • Research what tenants want and try to look out for desirable features such as off-street parking, home office space and proximity to shops or public transport. The more added comforts the property has, the more popular the rental will be.

The long-term security of property investment

After the fluctuations of the Australian property market in 2020, 2021 is proof that the real estate market is buoyant and can bounce back quickly after a steep fall. Real estate investment can be a great way to secure your finances for a comfortable income during retirement. Owning a rental property can boost your finances by providing you with the extra cash flow from rental earnings or the eventual sale of an investment property.

Diversify your investment portfolio and supplement other investments

You may already have diverted some of your savings into the share market, but if your financial position is strong enough you may want to consider investing in the property market as a way to diversify your investment portfolio and owning a rental property can add another revenue stream. Having a diverse portfolio can help to lower your risk in the event of a market downturn due to the fact that different types of investments are less likely to be affected by the same market fluctuations.

What are the experts predicting for Australia’s 2022 property market?

So, what do the experts expect to see in Australia’s property market over the next 12 to 18 months? Generally, experts are predicting that house prices will continue to rise over the next few years and interest rates don’t look likely to budge before 2022. With Australia in the midst of a housing boom and prices forecast to continue to rise, now is the time to invest in the Australian property market.

How can the experts help you to invest in the Australian property market?

Unless you consider yourself to be an expert in Australian real estate, you will need the support and advice of experts to ensure that you make a wise choice when it comes to investing in property. Seek the advice of a local real estate agent and, as soon as you have had an offer to buy a property accepted, hire a reliable conveyancer to assist you with navigating the legal requirements of real estate investing.


Part of the expertEasy writing team, Laura is from the UK and has a keen interest in Business, interior design and decor, home improvement and thriftiness in all things around the house and garden.

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