With a history of strong upward growth since about the 1960’s, it’s little wonder why so many offshore investors have flocked to the Australian real estate investing market to get a solid return on their money. If you’re one of those who want to capitalise on the reliable property market here in Australia, you’re probably wondering, “Where do I begin?”
Where to start with Australian real estate investing.
As a foreign investor, there are a number of things you have to do to ensure everything goes smoothly; from
understanding Australian government policy to ensuring the property you’re interested in is a good choice for your situation.
Whilst each person’s situation is different, here are three basic steps to get you started on the path to Australian property investing:
1. Resident v. non-resident
Unless you’re a bonafide Australian resident, as a foreigner, you will need to obtain investment approval before purchasing residential real estate in Australia. So it’s important to understand which residency classification you fall under when buying a property here: Resident or Non-Resident.
Typically, visa holding Australian residents are able to purchase property in the same manner as a citizen because Australia is their normal place of residency. On the other hand, non-residents have to meet certain criteria to purchase and are generally prohibited from purchasing existing dwellings.
2. Invest in new dwellings
As a foreign investor (non-resident), understanding Australia’s initiative to increase housing stock by way of new dwellings and developments (which helps the economy as well as increases the government’s revenue) means you should be looking into new residential developments as your investment vehicle.
New dwellings are properties that are yet to be built. For those which are built , they cannot have been previously lived in and must vacant. Other than being an outright brand new (vacant) residential property ready to purchase, a new dwelling can be proposed to be built on vacant land, be part of a house and land package, be in a new development or property redevelopment (eg: an old building gets demolished and a new building erected in its place), or similar.
3. Understand yields & capital growth
Rental yields (aka. rental returns) will vary depending on where your investment is located. Lower, more competitive rental yields tend to be closer to the city; while higher, more cash-flow positive ones are characteristic of rural areas.
On the flip side though, urban and inner-city properties will often experience very strong capital growth, while country properties take much longer to increase in overall value. This makes it important to understand your investment goal before you purchase – are you after positive cash flow or solid capital growth investments?
You can get started now!
If you’re a foreign investor looking to benefit from Australia’s strong real estate market, Image Property Group have a specialist team of experts that take all the hassles out of investing in Melbourne’s inner suburbs and surrounds. Contact us today to find out what investment opportunities we have available for you.
Please note: The information provided in this post is general in nature only and should not be considered financial advice. It has been posted without taking into account any of its viewers’ objectives, financial situation or needs. Before acting on any information, you should consult a license financial professional, as well as consider the appropriateness of the data, having regard to your own objectives, financial situation and needs.