Tuesday, July 6, 2010

Investing on a Melbourne Property By W Tsang

Money is best to invest on something you are familiar with or at least know something of instead of impulsively spending it. Real Estate is a popular investment for money but before deciding on a particular property, be sure to measure all possible angles. Melbourne, Australia is a sure interesting place to be in. But if you are planning on buying a piece of land or property in this amazing city, here are some issues to consider.

For a seasoned real estate investor, Melbourne may be the best place to look for a property to invest on. Experts on real properties even state that this city is ideal for any investor with a long term plan to engage in the housing market. Medium priced houses in this Melbourne city cost around $342,500.

The basic concept in Economics is 'Supply and Demand'. Investors also hold on to this concept as they participate in the property market. In Melbourne, the demand for a house is leaving behind the amount of supply. Meaning, many people are actually eye-ing on purchasing a housing property but the available on market of property for sales is not enough to address all the investor's needs. Rental rates is also expected to decrease because of this high demand. All over Australia, there are approximately 140,000 new residential unit sold in the market each year. This is quite a huge number already but yearly there are 170,000 people who desire to invest on a real estate so it is clear to see that supply is outnumbered by demand. Melbourne is not an exception to this, especially when the population expansion just in the metropolitan area increases about 40 year high. Supply stretches towards the breaking point accounting also for soaring rental rates.

As a result, the rental rate of the housing in Melbourne is expected to increase by 6% as each year ends. So if you are an investor on real estate in Melbourne, you should target and aim on the apartment marketplace for probably higher income returns. This projection is even supported by the statistical results gathered by the Real Estate Institute of Victoria which says that for the past twenty five years there is a tight vacancy rate of about 1.2 percent.

Every positive side also has a downside to it. The real estate properties in Melbourne which are put on sale has a mean price are considerably lower than those found in Canberra, Perth and Sydney. The Metropole Property Investment Strategists state that properties in Melbourne are rated too low.

From these acknowledged factors for consideration in spending a fortune on Real estate properties in Melbourne, it is a two against one ratio for pros and cons. In terms of Supply and Demand, Supplying real estate can be a real source of gains. Rental properties are good choices for spending your money on with guarantee of earning because a large section of Melbourne choose a more affordable rental than actual purchasing. But still if you are the investor, everything else depends on your final decision.

If you are looking for a Melbourne Real Estate Agent to buy, rent or sell your house. Try searching on Business.com.au -- an Australian Business Directory.