Do you have a lot of renters living in your neighbourhood and wondered what impact that has on the value of your property?
The Real Estate Institute of Victoria (REIV) looked into the question recently and found some surprising results.
It seems, in fact, that having a number of renters around may even improve your home’s potential for capital growth, as it is likely to draw investors as well as owner-occupiers to the area.
The REIV research found that in suburbs where less than 40 per cent of households were renting, the median house price grew by 67 per cent over the past ten years.
In suburbs where over 40 per cent of households were renting, the median house price grew by 81 per cent in the same period.
The impact on unit price growth is not as clear. It is also worth noting that there are also, of course, some exceptions where house price growth has been substantial even though the share of rental households is relatively low.
The Institute’s article concludes that this serves as a reminder that there are a many factors affecting your home’s potential for capital growth but having a high number of renters in the neighbourhood is unlikely to have a negative impact.