Property investors are becoming increasingly bullish about the current market following a sustained period of recovery, a new survey has revealed.
According to the Property Investment Professionals of Australia’s (PIPA) national survey, 82 per cent of investors think it is now a good time to buy, up 5 per cent from 2018’s result.
PIPA chairman Peter Koulizos said “long-term capital growth beat out cash flow – both long- and short-term – as the most important aspect when choosing an investment”.
Where are investors buying?
While Brisbane is once again the preferred capital city for investment among respondents, there has been a dramatic rebound in Sydney’s appeal among investors.
Brisbane remains the hottest spot according to property investors, with 44 per cent of investors believing it offers the best investment prospects.
Melbourne has come in second, with 27 per cent of investors believing it to be the best place to buy.
For Sydney, just 14 per cent of investors see the harbourside city as offering up the best prospects.
The survey also found that strong regional growth has not swayed property investors; 73 per cent prefer metropolitan markets to regional locations.
Only 8 per cent of investors expressed the opinion that coastal locations are the most appealing place to buy, while investors previously scared by the mining collapse are cautious of mining towns, with just 1 per cent saying it the most appealing place to buy.
Breaking up with the big four
The survey also looked at the popularity of investment lenders, finding that the big four banks are losing popularity with this class of borrower.
It found that 27 per cent of investors are choosing to secure loans from a non-major bank lender.
According to the results, cheaper rates and increasing borrowing powers are the two main factors swaying investors from the big banks.
However, given the recent tightening of lending conditions, some investors are finding the property market difficult.
“Given tight lending conditions and the financial sector’s response to the banking royal commission, a staggering 25 per cent of respondents have found they were unable to refinance an amount they were able to borrow previously,” Mr Koulizos highlighted.
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