- The Savvy Promise
At Savvy, our mission is to empower you to make informed financial choices. While we maintain stringent editorial standards, this article may include mentions of products offered by our partners. Here’s how we generate income.
In this article
Even though the idea of investing in your local area is attractive, because you can always go to your property when you want and check it periodically, investing in properties interstate is a new trend in Australia.
This happens especially because the market conditions differ from state to state. For example, in a particular area the property values are rising, but in another one the prices may fall. If you want to benefit from a unique combination of healthy yields and capital growth that will undoubtedly improve your property portfolio, you should consider investing interstate. But what should you know before you get started?
Get familiar with the market
If you live in Sydney, a property which costs $450,000 in Hobart may look like a great deal to you. But the truth is that this price is above the average value by more than $100,000. Nowadays, the median value in the capital of Tasmania is $332,400. Before making any investment, do some research. Get information from specialised resources on the Internet and try to identify the factors that may generate capital growth in the future. Never make an investment before getting to know your targeted market.
You may not always be able to see the property before buying it
Let’s say you live in Townsville, but you wish to invest in a rental property in Perth however do not have the time to view the property…How should you act in these circumstances? An option is to ask for professional help and contact a buyer’s agent. He/she may go to see the place for you and then provide all the necessary details. Indeed, you will have to pay for his/her services, but it will definitely cost you less than investing in an unworthy property or a journey to see the place in person.
The costs of stamp duty differ from state to state
The value of the stamp duty is not given by the location in which you live, but by the site of your property. So if you are investing in properties interstate, use an Australian stamp duty calculator to determine the accurate costs.
Seek a local property manager
As your new rental property will be in another state, it is next to impossible for you to reach it whenever it may be necessary. However, you should still know a few things about your tenants, maybe organise repairs to keep you with the market and maintain your properties value, or inspect the rental property from time to time. If you can’t do all these things, you may want to hire a local property manager. He/she must live near the area of your rental property and take responsibility for it. This way, it would be much simpler for you to take care of your estate, even though you are far away from it.
Discuss with a mortgage broker
If you need a loan for a property investment, you should consult with your local mortgage broker first. This way, you can make sure you choose the loan that is suitable for your needs.
Did you find this page helpful?
Written by Fact checked
This guide provides general information and does not consider your individual needs, finances or objectives. We do not make any recommendation or suggestion about which product is best for you based on your specific situation and we do not compare all companies in the market, or all products offered by all companies. It’s always important to consider whether professional financial, legal or taxation advice is appropriate for you before choosing or purchasing a financial product.
The content on our website is produced by experts in the field of finance and reviewed as part of our editorial guidelines. We endeavour to keep all information across our site updated with accurate information.
Approval for home loans is always subject to our lender’s terms, conditions and qualification criteria. Lenders will undertake a credit check in line with responsible lending obligations to help determine whether you’re in a position to take on the loan you’re applying for.
The interest rate, comparison rate, fees and monthly repayments will depend on factors specific to your profile, such as your financial situation, as well as others, such as the loan’s size and your chosen repayment term. Costs such as broker fees, redraw fees or early repayment fees, and cost savings such as fee waivers, aren’t included in the comparison rate but may influence the cost of the loan. Different terms, fees or other loan amounts may result in a different comparison rate.
