The real estate market has been witnessing a series of significant actions and reactions, with 14 interest rate hikes implemented by the Reserve Bank throughout the year. The possibility of further rate increases until inflation improves has left many buyers, sellers, and investors seeking answers about the market’s future. In this blog, we delve into the impact of these developments on investors, the supply of properties, and the ongoing rental crisis.
As a result of the successive interest rate rises, numerous investors who had previously overextended their borrowing capacity while purchasing properties are now finding themselves in a challenging situation. The need to balance their finances is forcing many of them to sell their properties urgently. Consequently, we can expect to see an increase in the supply of properties in the market, which may benefit buyers who have been patiently waiting for the right opportunity to enter the market. This trend is likely to continue through the end of the year.
While the increased supply of properties is promising for potential buyers, it has an unfortunate downside for the rental market. With investors selling off properties, there will be even fewer available rental properties for tenants. The already strained rental market is facing additional pressure, leaving many tenants struggling to find suitable accommodation. Without these homes being acquired by new investors, the rental crisis is unlikely to improve anytime soon.
For those considering purchasing properties amidst these changing market conditions, it is now more crucial than ever to exercise due diligence. With a wider selection of properties on the market, the risk of investing in properties with poor maintenance histories rises. Engaging the services of a skilled real estate professional can be invaluable in ensuring that buyers make informed decisions and avoid investing in ex-rental properties with underlying issues.
As the real estate landscape undergoes these transformations, we understand the importance of having a reliable partner on your real estate journey. Our team of experienced professionals is ready to assist you with valuable insights, sound advice, and comprehensive support throughout your buying or selling process. If you have any questions or need assistance, please don’t hesitate to reach out to us.
