The key investment criterion in the post-GFC world is certainly income. And it is why some buyers are attracted to housing.
Yields are higher than they have been for some time; they can certainly go higher; and in the long term house prices are more likely to rise than fall.
As cash deposit rates retreat, property yields look even better.
Two recent surveys by APM and NAB, point to a pause in rental growth. APM's Wilson says the underlying demand will lead to further upward pressure.
The ANZ's lead house price analyst, Paul Braddick, says house prices will probably stop falling in the next six months in Sydney and Perth "if they haven't already".
If Braddick sounds a touch cautious in that prediction, he is utterly confident about rents.
Investors in Sydney and Perth can expect rents to soar in the next few years due to low vacancy rates.
"Unless policy authorities start to do something about the under-supply of housing, I can't see how we can't have a long-term acceleration in rents," Braddick says. "As an investor you have very little chance of having a vacant dwelling and enormous upside in terms of existing rents."
Parts of this article came from the Weekend Australian Financial Review. It has been amended by Silverhall for the purpose of this blog post
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