Landlord Resources

What’s on the horizon for Australian property investors in 2024

By Mark Hamblyn, Terri Scheer Distribution Manager

As the real estate market in Australia heats back up for 2024, property investors are keenly watching the shifting trends and emerging opportunities for the year ahead. From rent prices and property locations to sustainability and changing regulatory requirements, investors are navigating a dynamic market. In this article we explore the key factors influencing Australian property investors:

Rental yields

Typically the primary concern of investment property owners, rental yields are once again a focus in 2024 as investors search for the delicate balance between strong rental returns and potential capital growth. Rising interest rates and surging weekly rents have forced many mortgaged investors to reconsider their purchasing strategies, tipping largely towards negatively geared properties with an eye on future capital growth. Investors have continued to secure positive cash flow properties in a number of locations around the country – such as regional centres – so potential investors should ensure they choose a strategy to suit their goals and seek independent financial advice for their individual situation.

Location, location, location

In a fast-changing property market, investors are remaining laser-focused on emerging hotspots and proven performers to secure a blend of strong rental demand and capital appreciation potential. Regional centres and outer suburbs with developing infrastructure, improved connectivity, and lifestyle amenities remain popular among Australians entering the investment market due to ongoing demand from renters seeking more affordable housing options. Despite rising interest rates and house prices well above expectations in 2023, highly valued properties in top locations around the country continued to fetch strong sales prices and top rental dollars, driven by the ongoing housing supply challenges which are expected to continue into 2024.

Energy efficiency and sustainability

Australia’s transition to clean and renewable energy continues to gather momentum with sustainability remaining top of mind for investors. From the investment decisions around solar energy to increased minimum requirements for new build energy efficiency and the phasing out of new residential gas connections in Victoria, property owners are looking closely at the environmental and financial considerations of energy efficiency. Sustainable features such as solar panels, rainwater harvesting and smart home technologies not only appeal to the environmentally conscious but can also enhance market appeal and help investors stay ahead in the competitive real estate market.

Government policies and regulations

Property investors are keeping a watchful eye on government policies and regulations that have the potential to impact their investments. Whether it’s recently imposed changes in tax laws and residential tenancy legislation in some jurisdictions, to ongoing discussion around proposed reforms and uncertainty around future tax treatment, existing investor owners and potential buyers alike are weighing up the gains and pitfalls for their own investment and portfolio strategy.

Have landlord insurance in place

In a constantly changing housing market, Australian property investors are not only navigating the current market trends but must also ensure they position themselves for long-term success. Beyond the quest for immediate returns, investors are increasingly focused on holding properties for the long-haul and mitigating risks through careful portfolio planning.

Long-term investment strategies involve a comprehensive approach that extends beyond the initial purchase. Investors are keenly aware of the importance of maintaining a sustainable cash position, factoring in potential market fluctuations and unforeseen expenses. A specifically designed landlord insurance policy can play an important role in minimising the potential financial impacts of tenant-related risks, such as loss of rental income, theft and damage to the property.

Terri Scheer is Australia’s leading landlord insurance specialist, offering dedicated policies to suit the specific risks landlords face. Find out more about our policies here: terrischeer.com.au/landlord-insurance/

For further information, call 1800 804 016.

Disclaimer:

Insurance issued by AAI Limited ABN 48 005 297 807 AFSL 230859 trading as Terri Scheer. Read the Product Disclosure Statement before buying this insurance and consider whether it is right for you. Contact Terri Scheer on 1800 804 016 or visit our website at www.terrischeer.com.au for a copy. The Target Market Determination is also available.

The information is intended to be of a general nature only. Subject to any rights you may have under any law, we do not accept any legal responsibility for any loss or damage, including loss of business or profits or any other indirect loss, incurred as a result of reliance upon it – please make your own enquiries. This article has been prepared without taking into account your particular objectives, financial situation or needs, so you should consider whether it is appropriate for you before acting on it.