POSITIVE YEAR AHEAD FOR RURAL SECTOR

Rural investors pick up the pace

It’s great to see some welcome signs of improvement in many of our rural economies. After several years of tough conditions, profit and yield forecasts appear stronger once again.

As a forerunner to this, we have already noticed that property inquiry levels from our rural investors are beginning to pick up.

For many people who work with the land, property is a traditional and well-understood investment. Its cycles of supply and demand, its secure underlying land component and its long term nature are easily appreciated.

Steady incomes and reliable capital growth are also very welcome characteristics, helping to offset more unpredictable incomes during the years for many farmers and growers.

Perhaps that’s why they often turn to a good solid property investment when extra cash flow allows.

And this year, more than many recently, is expected to see an increase in new investments by rural buyers. And the timing looks great.

Generationally low interest rates, including fixed rates at around 5 per cent, look set to coincide with the strong profit season ahead.

At the same time, property prices are in somewhat of a hiatus. Limited price growth in the immediate, short term is providing us with a strong negotiating point when we are buying for our clients.

Improved regulations to allow self managed super funds to invest in property also means real estate assets can now benefit whole families and different generations  — further reinforcing the strength and security of a long term property strategy, especially compared with the many high risk managed investment schemes going around.

 

Until next week

JOCK BING