What if property prices fall after I buy?
- They very well could. Over time, they certainly will at some stage. History shows clearly that prices do not rise in an unbroken progression. Downside “volatility” as financial advisors call it, is not only a possibility — you should plan for it to occur at some stage during your ownership. However, over the long term, you can reasonably expect prices to rise.
- Focus on quality property. Overall, prices in Adelaide aren’t too ‘stretched’ at present — well-priced property is selling well. Buying better quality property, preferably at advantageous prices will help to guard against some of the downside, and also make your rental property a ‘preferred’ choice for the next owner when time comes for you to sell.
- It’s also a good idea to keep some funds aside, to take advantage of any downturn, by buying another property. This helps with what some investors call “dollar cost averaging.”
- Remember your investment timeline. Prices moving down next month only matters if you need the funds in 2 months. But if you’ll need the money in 20 years, . . .
Using a good buyers agent won’t guarantee you will avoid a downturn (no-one knows the future!). But your agent will help ensure you are fully informed about prices, market values and trends, and able to make well-informed investment choices.
