Capitalising on Australia’s infrastructure boom
New infrastructure projects can boost local economies and have positive effects on the property market, creating great opportunities for investors.
With some $385 billion worth of infrastructure projects planned or underway across the nation – savvy investors can get ahead of the game if they know where to buy.
New projects create jobs and confidence in existing jobs, leading to increased demand and positive flow-on effects for the property market.
Staying across the major infrastructure announcements and future plans is something all good investors should do. Big projects such as transport, education or health can make all the difference to the future value and rental demand for an investment property.
According to a recent report by Australian Property Investor, there are currently 99 individual projects each worth more than $500 million proposed across the country with the potential to create some 200,000 new jobs if they were to all proceed.
That’s $163 billion in transport projects, $210 billion in mining, $52 billion in tourism, $112 billion in health and $51 billion in other projects.
Queensland has the lion’s share of the infrastructure projects with some $135 billion planned. Western Australia is next with $109 billion, followed by New South Wales with $62 billion and Victoria with $42 billion. South Australia has $38 billion, the Northern Territory $6.7 billion, ACT $0.8 billion and Tasmania $0.6 billion.
EBM’s Executive General Manager, RentCover, Sharon Fox-Slater said the state of the local market, including future plans and projects, were just some of the factors investors needed to look at before committing to a property.
“There are a number of important things to consider when determining a good investment and understanding the major new projects planned for the local area is one of them."
“New and improved transport infrastructure can make an area more accessible and desirable, opening it up to a whole new market and level of interest."
“Major new industry or institutions such as hospitals or schools will again boost the local economy, create jobs and bring more people into the area.”
Sharon warned however that the announcement of a major project should never be the sole basis of a real estate investment decision.
“Projects can take many years to come on line and in many cases are changed or shelved completely with a change of government or economic circumstance."
“Waiting on the train that never comes to boost the value of your investment or attract higher rents is not the way to go."
“As always, if you’re looking to invest it’s important you seek the right advice and get a clear understanding of the major drivers of the local market you are looking to buy into.”