Recovery Commeth - by Matusik - Queensland Property Investor
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Recovery Commeth – by Matusik

OZ, The Great & Powerful. Moreton Investor (10), Property Management, Real estate Moreton, Mortgage Broker Moreton, Moreton property market
Now that should be the title of this missive.  But we just don’t want to believe it.  Most of the rest of the world does.  But still we don’t see it.
The weekend papers ran headlines like: “Forget talk of gloom, this is all boom” & “We’re doing so well yet we keep whingeing”.  At dinner on Saturday night a mate summed up our current malaise in a nutshell:  “We worry more about the Greek economy than the Greeks do.”
The Herald-Lateral Economics Well-Being Index (which measures both individual economic circumstances & happiness) shows that we should be doing very well.  Our well-being is up 5% on last year.  But still we whinge.
Well, there shouldn’t really be much to whinge about when it comes to residential property, especially in my neck of the woods, being Queensland & in particular the south-east corner of the state.  But still, there are many Doubting Thomases.
On a broad scale – interest rates are low & still falling; gross rental yields are now often in positive territory; the sharemarket is improving & we have plenty of money saved – in term deposits; in our superfunds or in advanced payments on the mortgage.  The past shows us that it usually goes – cash first; shares second & property third.  The experienced keep telling me you make your cash-flow by trading shares & real money in buying & holding property.  You make your money in property when you buy, not when you sell.
In addition, this time around we have self-managed super funds, which hold over $1.5 trillion dollars in assets.  Yet these funds have little exposure to property, though they can borrow (with strict rules) to buy property assets.  This segment will be a big part of the residential investment scene over the next five years.  They will add considerable momentum to this residential recovery.
Now for mine, it is a great time to buy in Queensland & especially in Brisbane.  And there are ten reasons why:
1.    Queensland’s population growth increased by 75,000 last year – up 50% or 25,000 on 2010’s 50,000 annual increase.  History shows that Queensland attracts a third of Australia’s annual population growth.
2.   According to the ABS employment figures, 30,000 new jobs have been created in Queensland since late last year & more than half of these were in Brisbane.
3.    Based on last year’s statistics, Queensland looks to be heading towards a massive undersupply, with 33,000 new dwellings needed during 2012, yet just 26,000 supplied – an undersupply to the tune of about 20%.  The inner Brisbane apartment market is also undersupplied & in this case by as much as 40%.  There is a need to build 2,650 new apartments across inner Brisbane every year, but just 1,600 new properties have been delivered (each year) since 2006.
4.    The Brisbane vacancy rate is currently 1.9% & whilst rental growth has slowed down, median rents still rose across much of the state last year.  Importantly, rental properties are showing good rental returns, averaging 5.5% gross.
5.   Economic forecasters, BIS Shrapnel, predict that Brisbane’s dwelling values should start to grow in earnest during 2013, accelerating in 2014 as the economic upturn gains momentum & the underlying dwelling deficiency becomes more pronounced.
6.    Official statistics show that new property prices across Brisbane have already risen by 4.9% during 2012, which is strong against the national average increase of just 1.4%.
7.   There has been a 6% drop in the number of properties listed for sale across Brisbane during 2012.  Resale supply is starting to tighten.
8.   In addition, there has been a 10% increase in the number of settled sales across the south-east corner of Queensland over the last twelve months.  Overall properties are now selling faster than new ones are being listed.
9.    Whilst Brisbane isn’t an auction city, but when comparing Brisbane auction results so far this year, against those from early 2012, there has been a 56% increase in the number of properties sold at auction.  There are increasingly bigger crowds at auctions & better results on the day.
10.  Finally, Brisbane is now quite affordable, being the third most affordable major urban place in Australia.  And this is one reason why Queensland’s population growth is increasing again.
It is a somewhat closed circuit – a Queensland & even Australia-wide residential recovery – it starts with improved liquidity; improving profits (& a better share market); competitive (often real) returns; higher household formation & scarcity – perceived or otherwise.  Human nature slows & stops the cycle – being overly cautious now & in due course greedy.  Confidence is the key.  It is missing now.
OZ, The Great & Powerful.  Yes, but only if you believe!  Now that would make a great title for a movie, don’t you think?
 
Article originally published in  Matusikmissive.com.au   12/3/2013

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Brisbane

Buyer’s agent shines light on Brisbane property market

Buyer’s agent shines light on Brisbane property market

Speaking to SPI, Melinda Jennison of Streamline Property Buyers explained why now is an exciting time for property investors in Brisbane.

“As the third largest capital city in Australia, Brisbane is the economic engine for Queensland as a whole,” Ms Jennison said.

“Over recent years we have experienced an apartment oversupply in the inner city ring suburbs which has definitely had an impact on investor returns in terms of capital growth and rental yield in that market. The run-off effect was that vacancy rates in inner ring suburbs started to increase which resulted in negative rental price growth.

“The middle ring and outer suburbs were less effected. But more recently construction commencements have slowed right down and we are now facing a period in the immediate future of potential undersupply which is likely to put upward pressure on prices.”

Further, Ms Jennison said the team is already seeing vacancy rates drop sharply. She noted that rental price growth has also been consistent for a few months.

“The immediate future looks very bright for investors considering we have population growth that is accelerating and a record volume of infrastructure projects underway which will help stabilise the local economy in the years ahead,” Ms Jennison said.

“That said, the housing market in Brisbane has been performing strongly in some suburbs – even in light of the fact that the median price growth for Brisbane houses over the last 12 months has shown a relatively flat market.

“We have been purchasing properties for clients in suburbs that have shown consistent year-on-year price growth upward of 5 per cent per annum for the last five years. It all comes down to local drivers of supply and demand and understanding, at a local level, what is happening in the Brisbane property market. “

Growing appetite

According to Ms Jennison the Brisbane market is being taken advantage of by interstate investors, undoubtedly because of the affordability factor when compared to Sydney and Melbourne.

“Our investment yields are also a lot more attractive, which is another reason interstate buyers are heading north,” she added.

“Brisbane also has all of the fundamental drivers of solid price growth in place and there are many large research groups including QBE Housing Market Outlook and BIS Oxford Economics who are predicting very good capital growth – up to 20 per cent across the next three years – in Brisbane.”

Ms Jennison expects more interstate investor activity in the months ahead “as property investors start to see price rises in Brisbane (hopefully) and then, as often happens, a lot more people will move in once the upward price growth trend is established”.

“But more so than this, I think a lot of people have much better access to funding since the APRA changes came into effect and we have also seen two interest rate cuts (with more to come) so there is certainly more confidence in property markets as a whole,” she said.

Obstacles

Streamline Property Buyers was launched by Melinda and Scott Jennison just over 12 months ago.

During this time, Ms Jennison says one of the biggest obstacles they’ve seen clients face is maintaining a strategy when it comes to their property portfolio.

“We are finding that a lot of clients are quite confused when we speak to them about what property investment strategy is going to be right for them,” she explained.

“There is so much information and so much ‘noise’ about different investment strategies on offer today. Capital Growth, cash flow, flip, manufacture equity, development…. for the average investor a lot of this information can be overwhelming.

“Part of our service is that every client gets a one-on-one strategy session with a Qualified Property Investment Advisor (QPIA) so we can help clarify what type of strategy might be best suited to an individual investor’s personal circumstances.

“Because we are all different in terms of our goals, our risk appetite, our incomes and our lifestyles, it is important to understand what investment strategy might be best suited to the individual and not take a ‘one-size-fits-all’ approach.

“Also, for those looking for a more sophisticated strategy to manufacture equity or complete a development project, we have the team that can assist with the whole process from concept to completion. So our service is usually tailored to the needs of our clients. “

It is this service capability which was one of the reasons why the Jennison’s decided to roll out Streamline Property Buyers to the Brisbane market.

“Scott and I have been involved in Brisbane property for more than 20 years as investors, builders and property developers. We wanted to create a boutique service offering where we could guide buyers who may not have the same intricate knowledge of our local property markets,” Ms Jennison said.

“Brisbane property is very different to Sydney and Melbourne in terms of land constraints (eg flooding) and our architecture (largely tin and timber homes). Therefore it is important for property investors to understand how these differences can impact on the performance of an asset.

“While property investing is largely related to selecting the right location for the relevant investment strategy, our business was created on the foundation of helping others not only select investment grade locations in Brisbane based on the numbers and our local knowledge, but also to ensure people avoid costly mistakes and to provide complete transparency around the asset that they are looking to buy.”

Another reason was to fill a knowledge gap that a lot of people have during the home buying process.

“During a project where I was managing a small townhouse development for a client, I reached out to the adjoining property owner to discuss the dividing fence. During my discussions, she told me that they had just moved in to the property only weeks before we demolished the single house next door and started to construct three townhouses in its place. She was devastated and had no idea she would be living next door to three neighbours instead of just one,” Ms Jennison said.

“It made me realise that most people would not understand what land zoning means, how to find approved developments in an area, what areas will change due to development or planned infrastructure in the future – among other things.

“It was a light bulb moment where I realised the skills Scott and I had could really benefit property buyers throughout Brisbane.”

Going forward

For Ms Jennison, Streamline Property Buyers primary goal is to “select the best possible property for our clients every time, one that we know will not cause headaches down the track but will deliver the desired results that a client is looking to achieve.”.

“We also want to enable our clients to become more confident property investors following their experience with us,” she added.

“We achieve this through our unique service offering. Every client gets access to every team member throughout their journey with us. We don’t just take over the process, we help people to understand the reasons why a property may or may not be a good investment for a particular strategy.

“When we achieve this, our clients become raving fans and this is how we build our brand and our business into the future.”

 

 

Source: www.smartpropertyinvestment.com.au

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Gold Coast

Chinese buyers in Australia: Here for holidays and here to buy property

Chinese buyers in Australia Here for holidays and here to buy property

Chinese buyers have Australian property set firmly in their sights again, with a new survey revealing nearly a third of Chinese tourists plan to shop for property while they’re on holiday.

Property portal Juwai’s new survey of Chinese consumers found that 27 per cent of mainland Chinese tourists planned to look at properties over the next year as part of their travels, and that Australia was their No.1 destination to go shopping.

In Juwai’s list of top Australian destinations by inquiry, Brisbane came in third and the Gold Coast fourth, after Melbourne and Sydney.

Juwai spokesperson Dave Platter said demand for Gold Coast real estate in particular was likely to increase as buyers continued to return to the Australian property market.

“On the Gold Coast in particular, in both of the past two quarters, Chinese buyer inquiries have gone up double digits,” he said.

Chinese buyers in Australia Here for holidays and here to buy property 1

“It’s got relatively inexpensive prices for what you get, and there so much infrastructure and investment going in,” Mr Platter said, noting that the new public transport connections held particular appeal. “And it’s easy to get to from China.”

Of the Chinese consumers surveyed, 49 per cent were looking to travel during the school holidays in July and August, 42 per cent were looking at National Day Golden Week in October, and 29 per cent during Chinese New Year Golden Week in February.

While the numbers of buyers coming from China had been falling since 2016, internal research showed that it had recently flattened out and was showing signs of increasing again.

Mr Platter added that for Queensland especially, demand was quite seasonal, with a lot of buyers shopping for properties while they were on holiday.

“They’re really looking, and they might come back to purchase,” he said. “But we hear all the time about buyers who show up and buy.”

Chinese buyers in Australia Here for holidays and here to buy property 2

“A lot of the agents will rent out a van and drive families around, and introduce them to the local highlights.”

Mr Platter said these tourist buyers were primarily looking at new developments, in part because of the Foreign Investment Review Board’s guidelines around non-residents buying resident property.

New builds were particularly appealing to Chinese buyers, he added, and many had already made good money from their investments in newly-built properties at home.

He said that as far as they could see, concerns about the build quality of off-the-plan purchases didn’t seem to be a big deterrent.

“It just reinforces the importance of buying from a good developer,” Mr Platter said.

Buyers preferred firms who had longer track record of development, and Mr Platter added that some of the biggest developers in Australia came from China, and so were already known to them.

Chinese buyers in Australia Here for holidays and here to buy property 3

He cited Australia’s quality of life, development and commercial ties with Asia as reasons it was a popular destination, as well as the power of education.

“Australia attracts a very large number of Chinese students,” he said. “Buying for a student who is going to be studying here is one of the most cited motivations among our buyers.”

Agent Val Parkin of Alex Phillis Real Estate in Paradise Point said he was getting quite a lot of inquiries from foreign buyers on his FIRB-approved apartment listings.

“I would say 50 per cent,” he said. “It has picked up for sure. We actually sold five already in the past month.”

He said the FIRB approval was big factor for foreign buyers and those properties currently offered a 10 per cent return, which made them appealing to investors.

“We advertise a lot on social media – through those channels,” he said.

Previous Juwai research had found an 50 per cent increase in the first half of 2019 – compared to the first half of 2018 – of inquiries from buyers looking for retirement properties, with the site now adding a specific retirement portal to their search engine.

 

 

 

Source: www.domain.com.au

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Brisbane

Residential property near Brisbane’s Cross River Rail pinpointed as investor opportunity: John McGrath

Residential property near Brisbane's Cross River Rail pinpointed as investor opportunity John McGrath

The latest figures from the Australian Bureau of Statistics show the value of new loans to investors (excluding refinancing) across Australia jumped by 4.7% in July – the highest monthly gain since September 2016.

On the east side of the country, Canberra led the way with a 22% spike in the value of loans from June to July, followed by Queensland at 8.1%, Victoria at 5.7% and NSW at 2.0%.

John McGrath told Switzer readers, “My best piece of advice for property investors is to buy quality and focus on location and aspect.”

“Go for a quality property in a great street, in a desirable neighbourhood, with plenty of amenities such as cafes, shops and public transport. These properties might cost a bit more, but you’ll get better capital gains.”

“In terms of locations, I think a good strategy is buying close to new infrastructure. There is so much building going on and this is creating opportunities for investors to capitalise, especially in areas where prices have fallen during the downturn,” he added.

He analysed the impact and reasons that investing near the Brisbane Cross River Rail which is starting at the end of 2019, with the aim of opening 2024, may have potential.

IMPACT: Stretching from Dutton Park to Bowen Hills, the 10.2km line will provide a second river crossing so more trains can run. It will include four new stations and revitalised precincts at Boggo Road, Woolloongabba, Albert Street and Roma Street, with upgrades to existing stations at Dutton Park, Exhibition, Salisbury, Rocklea, Moorooka, Yeerongpilly, Yeronga and Fairfield.

OPPORTUNITY: We tend to see a lift in property values when projects are announced, commenced and completed. Using Woolloongabba as a case study, the median house price sat around $770,000 from 2015 to 2018 but is now starting to grow. It’s $822,000 today, up 7.9% over FY19. The median apartment price has been drifting down since 2015 from $526,500 to $405,000 today.

PREDICTION: CoreLogic-Moody’s Analytics predicts 1.2% growth in house prices and 9.1% growth for apartments over CY20 and CY21 in Brisbane-South, which incorporates Woolloongabba, Fairfield, Dutton Park and Yeronga.

He also looked at the latest Melbourne, Canberra and Sydney infrastructure developments and the impact they have had and will continue to have.

 

 

Source: www.propertyobserver.com.au

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