Build to Rent

by | Apr 19, 2023 | Investing

We’ve all heard this term used recently, but what is it all about? Could these developers know something that others don’t?

Prominent property developers are choosing to build and keep their developments instead of selling the apartments or new homes off the plan. They are taking advantage of the worsening shortage of rental properties (Melbourne vacancy rates at circa 1%) and betting on solid capital growth (prices increasing) in future years to optimize their profits and returns. These developers are property professionals who have years of experience in the industry and deep pockets to conduct feasibility studies – and this is what so many of them are now doing.

This is a great strategy and can be carried out on a smaller scale by mum and dad investors. If its good for the professional developers, it could be a good thing for you also. Knowing there is such a huge shortage of rental homes, and this is expected to worsen with the huge increase in migrants arriving on our shores. Plus, for so many – home buying has become unaffordable and these people will have no choice but to rent. Overall, we are expecting boom times for investors. The key is to get moving before the masses move into this space. As the rental crises worsens those in a position to keep buying investment properties will prosper. Keep in mind, it is important to buy new because of the tax advantages that come along with purchasing new homes.

To listen to Bob and Matt Ellul (Director – Buyfair Property Group) speak further on the key fundamentals driving the property market, watch their talk at the Home and Land Expo at the Melbourne Convention Centre recently.

In these crazy times with interest rates rising and a growing number of builders going under, there are opportunities for those that are prepared to get out of their comfort zones and make solid decisions for their future.

To learn more about what opportunities may be available to you, reach out to us for a friendly discussion.