Ben Kingsley on 7 News: Victoria Named Worst State to Invest

The city of Melbourne has been ranked as the second worst capital city in Australia for property investors, with one in four Melbourne landlords selling their rental homes in the past year, according to the annual Property Investment Professionals of Australia (PIPA) survey. This significant trend has raised concerns for tenants across the city.

The survey estimates that a total of 217,000 investment homes were sold nationwide over the past year, impacting the rental market in Australia. PIPA also predicts that up to 38 percent of investors are considering selling a home in the next 12 months, double the figure predicted in 2022.

The Chair of PIPA, Nicola McDougall, expressed concern about the high number of investors contemplating selling due to rising interest rates, describing the situation as “scary.” She hopes to see more investors return to the market but is uncertain if this will happen given the current economic conditions.

The survey of 1,724 investors across the country, including 538 in Victoria, revealed that increased property taxes were the primary motivation for investors to sell, accounting for 47 percent of sales nationwide. Other significant factors included changes to tenancy legislation (43 percent) and rising loan repayment costs (40.1 percent).

Melbourne’s decline in popularity among property investors is striking, as it went from being perceived as the nation’s second-best place to buy in 2017 to just 4 percent approval in the survey, with only Hobart ranking lower among state capitals.

Ben Kingsley, Chair of the Property Investors Council of Australia and Managing Director of Empower Wealth, expressed concern that Victoria could lose investors to other states or discourage them from investing in property altogether. He also expects a surge in investor sales in Victoria in the coming 12 months due to upcoming land tax changes starting in January.

Watch this video now to find out more.