Why bursting property bubble won't hit Ipswich investors
THE property sector is all doom and gloom as the market prepares for the price-driving bubble to burst but anyone who owns property in Ipswich shouldn't panic, with interest rates presenting the only possible stumbling block.
Ipswich real estate agents agree market forces impacting Sydney and Melbourne won't hit regional centres like Ipswich, where prices have been steadily climbing since 2014.
Instead Ipswich's comparatively cheap market will likely continue to grow as more people move out of Brisbane and into growth suburbs like Redbank Plains and Ripley.
Foreign investment is a major driver in capital city markets with overseas investors snapping up properties, pushing up demand along with prices.
Australia's Foreign Investment Review Board last week reported a significant drop in foreign residential real estate approvals - a signal the boom has ended.
Historically low interest rates are tipped to increase after no movement for two years. Ipswich agent Darren Boettcher says that may impact buyers who may suddenly find themselves struggling to make mortgage payments.
"If they only go up 1 or 2 percentage points, it won't have an impact," Mr Boettcher said.
In January 2014, a house in Ipswich cost about $280,000. That's now up to about $360,000.
First Action National Realty owner Glenn Ball said prices were still so low in Ipswich that a "scary downturn" was not possible. He said even if interest rates went up, investment would likely still flow to Ipswich.
"People who want to invest will look at places like Ipswich, where there is still room to move (price-wise).
Investors can take on a cash-flow positive investment (earning rental income) and ride out the lull in the capital cities."
Mr Ball's agency has just experienced a bumper month with 34 properties going under contract.
All were priced below $500,000.