Geelong rental home sell-off creates chance for first-home buyers By Nicole Mayne
A recent spike in the sale of Geelong rental properties has created fresh opportunities for entry-level buyers trying to catch a break.
A rush to offload rental properties has created a fresh opportunity for first-home buyers to get into Geelong’s market.
Ray White, Lara director Jo Boothroyd said double the usual amount of investment properties had been sold in the northern suburbs over the past year.
New minimum standards, the financial pressures of coronavirus and a desire to cash in on big price growth have all led landlords to abandon of the market.
Latest data shows the number of available rental properties across Greater Geelong has fallen 12.5 per cent, encouraging some young buyers to seize on former rentals as their ticket to home ownership.
Ms Boothroyd said first-home buyers could avoid rising rents if they were able to purchase instead but faced competition from a new wave of investors also capitalising on low interest rates.
She said the introduction of new minimum standards for rental properties and the Covid pandemic had exacerbated the natural movement of landlords out of the investment market.
“What has happened is you have got all of these colliding pressures coming together at once,” Ms Boothroyd said.
“We have seen double the amount of investment properties sell than what we normally do. “That in turn has put a lot of pressure on the rental market because there is less property available, which then creates demand which then creates a higher rent so affordability has been impacted.”
She said Geelong’s affordable northern suburbs were a hunting ground for Melbourne investors and young buyers.
“You can’t get a rental so the next best thing is to go let’s go and buy a cheap little doer-upper,” she said.
Teacher Isaiah Graham, 25, and his partner Breahanne Galea consider themselves fortunate to have recently purchased their first home for $510,000 in Corio, where they are currently renting.
They opted for an older three-bedroom house on a 530sq m block — bought sight unseen due to the current lockdown — over a more expensive house and land package in a new estate.
“The housing market is pretty junk for young people to try and get into,” Mr Graham said.
“We are pretty stoked and pretty excited but we are still counting ourselves pretty lucky for what we actually got for the price we found it at.
“We went to a couple of places advertised for $440,000 to $480,000 that got private offers and sold for $550,000.
“A lot of the places we called up about were already under offer or they had sold for $100,000 more than what they were advertised for.”
Maxwell Collins, Geelong director Nick Lord said Geelong’s strong capital growth and exceptional rental demand continued to attract investors from Melbourne and Sydney.
He said Victorian rental reforms introduced in March, including new minimum standards and provisions for tenants to make minor modifications, had not sparked the mass sell-off some initially feared.
“Historically we have seen the sales market buoyant and the rental market flat or vice versa, this is the first time in 20 years I’ve seen both market have been exceptionally strong,” Mr Lord said.
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