If you’re looking to invest in 2022, there are some emerging trends and market factors that you need to understand. Your best solution for dealing with things close to home will always be to work closely with someone who knows the area (for example, if you wanted to invest in the state of Victoria in Australia, you’d do well to contact a company that offers commercial property management in Melbourne). However, there are some more universal things going on that also deserve your attention.
Rapid Fluctuations
With inflation rising and society still trying to get past the pandemic, 2022 could be a year of rapid fluctuations in the property market. This means you’ll need backup plans for your backup plan if you want to be secure in the knowledge that you’ll succeed.
Interest Rate Increases Could Affect Markets
With interest rates set to rise, many people may find that their current mortgage reaches a place where they can no longer afford the repayments. This could lead to a dip in the market as far more properties than usual become available.
Such a scenario could cause harm or create benefits, depending on how you’re positioned. You may be able to snap up a new property for a lower price, but the equity you hold in existing investment properties will fall along with the market.
Slowing Growth
We are most likely heading into a period of slowing growth. Even if the market does not experience a dip, pressure on the system often leads to properties gaining less value than what was projected.
This is fine for those looking to invest long-term as you should still receive strong rental returns. However, if you’re the type who’s looking to renovate and flip, this is a factor that will need to be considered when making any decisions.
Further Shifts Towards Ecommerce
The shift towards completing more and more of our shopping online is showing no signs of slowing down, and this could be beneficial or detrimental to your investments, depending on where they lie.
In terms of property, this shift means that living further out of town is becoming a far more viable option for many, so you may wish to snap up a good deal on the fringe of a larger city while prices are relatively cheap.
Focus On Sustainability To Continue
Another shift that seems to be growing is our increased focus on sustainability. This means that investing in eco-friendly upgrades can be highly beneficial to you and the environment.
If you have the capacity to add solar panels or a green wall, your property will be in demand. To further increase your investment’s appeal, consider creating a sustainable multi-business complex. This allows you to collect multiple sets of rent while decreasing both your carbon footprint and those of your tenants.
Tangible Assets Are Still Strong
Although it may seem that the property market is a bit risky at the moment, all investments are, no matter the state of the economy. Because of this, we expect tangible assets to continue their trend of being one of the safest investments to hold. If residential property isn’t your thing, or you’d like to expand your portfolio into other areas, consider reaching out to a commercial property advisor to explore your options.
Please remember that this article is general in nature and not intended as advice. As much as we recommend taking note of these trends before making investment decisions, there is no substitute for personalized support from a qualified investment advisor who understands your specific circumstances.
