Investors turning away from Sydney to other markets: RE/MAX

Discussing the value in the market at present, and the current discussions around a property bubble, franchise director of RE/MAX Australia & RE/MAX New Zealand, Keith Walker, has said that investors are starting to look towards the cheaper markets.

In Sydney, demand and a shortage of listings are driving prices up, said Walker, causing investors to turn elsewhere for options.

He pointed to the gap between Sydney house prices and those of other major Australian cities causing investors to respond.

“In the past, when the gap between Sydney house prices and those in other major centres reached in the 30% to 40% range, investors found better value in markets where rental demand and rents were as solid and the buy-in prices were lower,” said Walker.

“Investors are indeed looking to Queensland, South Australia and Tasmania, for example, to markets where they can get good return on their investment dollar while spending less up front.”

Buyers will also start to consider different price points as the lower end of the market’s opportunities dry up, which should start to push up the median price.

“We can expect even greater competition at the popular price points and both buyers and sellers will need an agent who understands local area values, establishes prices accordingly and negotiates well,” Walker explained.

“Markets where there is action or even positive conversation around major infrastructure projects are ones to watch and possibly move on sooner if you are an investor.”