Most people have a two fold purpose in buying a property: to have somewhere to live and an appreciating asset. The goal would be able to buy the perfect house for you and your family in an area where you knew would appreciate in value and become the next big hot spot on the real estate map. But is that possible?
Well if you look at this article mentioned on the Brisbane Times about growth you will see that some people actually managed to do that. Very, very fortunate.
These two sentences sum it up the best:
And 1999 was also the year you could buy a home in Rocklea, in Brisbane’s south west, for just $75,000.
In the decade since, house prices in the suburb - the home of the Brisbane Markets, 9km from the CBD - soared 380 per cent to $360,000.
What were the factors of the growth? Could you find a pattern and apply it when you are looking for your property? Well the short answer is no. Even the RP data guy said they recognised some of it, but even the best analysts would find it hard to predict 10 years ahead for new areas.
So I guess what you can learn and take away is that sometimes you might just get a little bit lucky when you are house hunting. Finding a home with growth potential shouldn’t be the main focus - it should be where you can live and afford. Basing your mortgage repayments - or going interest only in the hope you will get lucky and clean up - isn’t really a strategy we would recommend.
Don’t leave your mortgage repayments to a game of ifs/buts/maybes.
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