Interest-rate risk
Variable borrowing costs can rise quickly. Stress-test repayments and holding costs at higher rates, not only at today's rate.
Vacancy and rental risk
Budget for periods without rent and for leasing costs. A low historical vacancy rate does not guarantee continuous occupancy.
Capital-value risk
Property values can fall. If you need to sell during a downturn, transaction costs and loan balances can amplify the loss.
Concentration risk
One property is a large exposure to one asset, one location and one tenant market. Diversification should be considered across your broader financial position.
Liquidity risk
Property can take weeks or months to sell, and selling only part of a property is generally not possible.
Unexpected ownership costs
Repairs, special levies, insurance changes, land tax, compliance work and property-management expenses can reduce returns.
Construction and settlement risk
For new property, delays, defects, builder failure and valuation shortfalls at settlement are important risks.
Policy and tax risk
Tax and housing policy can change. The 2026 negative gearing and CGT reforms are a current example of why a property strategy should not depend on rules remaining unchanged indefinitely.