Savvy investors should buy in Victoria amid investor exodus, says property expert

Despite the recent media attention on property investors leaving Victoria due to new land tax policies and rental reforms, national buyers’ agency Adviseable suggests that now is the ideal time for savvy investors to buy in the state.

Kate Hill, Property Buyer at Adviseable, believes that the current investor exodus presents a unique opportunity for smart investors to take advantage of lower competition in the market. “Now is the time to invest in Victoria because of much lower competition from other investors,” Ms Hill said.

She emphasized that property expenses and taxes are an inherent part of long-term property investment and are tax-deductible. “The key is to recognise that Victoria continues to be a sound property investment location with solid prospects for cash flow and capital growth over the years ahead,” Ms Hill added.

While acknowledging that many investors have sold their properties in protest against the new land tax regime, Ms Hill argues that the smarter move is to ride it out. “No one likes new taxes or levies, but it is illogical to believe that Victoria – which is home to nearly seven million people let’s not forget – does not offer a plethora of opportunities for investors now and into the future,” she said.

Ms Hill pointed out that not only are there fewer buyers in the market, but property prices have also been subdued over the past year, and the vacancy rate in Melbourne is just one per cent. She warned that the investor exodus could lead to a prolonged rental crisis, pushing rents higher and creating a terrible situation for renters.

Cautioning against the current trend of investors flocking to Perth, Ms Hill stated, “Perth is over-cooked with many investors overpaying for inferior dwellings, because seemingly the Western Australian capital is still the ‘new property black’.” Instead, she believes the smartest investors are cherry-picking the best opportunities in Victoria that offer superior upside potential for those willing to look past the current rental reform and tax agenda.

Ms Hill acknowledged that while the Victorian land tax is a “hideous and outrageous cash grab,” it is important for people to stop demonising Victoria. She noted that other states have also passed rental reforms, but those haven’t garnered the same attention because Victoria’s land tax directly and more swiftly impacts investors’ bottom lines.

“At the end of the day, minimum standards for properties do still cost investors money – they can’t get around that regardless of what state they invest in,” Ms Hill concluded.