Jenman - Find an Agent you can Trust logo
phone icon 1800 1800 18

Reading Time:

32 minutes


01 December 2016

Property Report – December 2016

Quarterly Market Report No. #41 – December 2016

By Terry Ryder, creator of

Introduction: Expect Change And Surprising Outcomes In 2017

This time last year I suggested 2016 would be a year in which the smaller cities emerged, as the larger ones showed signs of fading.

In many respects that has proven to be true. Sales activity has fallen markedly in both Sydney and Melbourne and most research sources have recorded a decline in the rate of price growth in Sydney.

Meanwhile, Hobart has produced quite strong numbers for price and rental growth, as has Canberra. Sales activity has been solid also in Adelaide and Brisbane, and some precincts in those cities have delivered good price growth – although the average rate of growth has remained moderate.

So now my thoughts turn to the New Year and speculation about what will occur in 2017. This report is devoted to discussing prospects in major markets around Australia in the year to come.

In simple terms, we can expect very different scenarios to those in 2016, with outcomes that will surprise some people.


For analysis of markets nationwide, click on the topics below …

National Overview: Expect Major Change In Property Markets In 2017.

Adelaide/South Australia: Adelaide Will Excel If The SA Economy Shows Improvement.

Brisbane/Queensland: Queensland Will Have Several Standout Markets In 2017.

Canberra/ACT: Capital Set To Rise In 2017, Supported By A Strong ACT Economy.

Darwin/Northern Territory:  Expect This To Be The Best Year For Darwin Since 2013.

Hobart/Tasmania: Investors Are Waking Up To The Potential in Hobart and Launceston.

Melbourne/Victoria: City of Greater Geelong Set To Outpoint Melbourne On Growth.

Perth/Western Australia: Perth’s 3yrs Of Struggle May Be Over (Except For Inner-city)

Sydney/NSW: Lower Levels of Growth Likely But Sydney Market To Remain Solid

Conclusion: Ignore Media And Conduct Genuine Research To Succeed In 2017


National Overview

Expect Major Change In Property Markets In 2017

It’s noticeable that many commentators, when asked to forecast the year ahead, simply predict the recent past. They look at what they think is currently happening and extrapolate it forward. So most of what you will read in mainstream media about 2017 will be simply an extension of events in 2016.

But I’m expecting big differences in major markets around Australia in the coming year.

Some analysts are suggesting big price growth in Sydney. I think that is unlikely. The gradual decline in market performance around Sydney was evident throughout 2016, with sales activity down and all research sources, with one notable exception, recording a sharp reduction in the overall rate of price growth.

The most deceptive of all market barometers, auction clearance rates, are still being misinterpreted by non-experts, such as finance expert (but property dunce) Alan Kohler, as a sign of a still-booming market.

Most commentators, other than the genuine real estate specialists, are missing the rise of cities such as Adelaide and Hobart. In the same way, non-experts who look at those generalised single-figure descriptions of price growth or vacancy rates for entire metro areas, are misinterpreting the Brisbane market.

So, here’s what I see in the year ahead:-

All of those predictions are, to a certain degree, dependent on events, some of them unforeseen.

But in other respects predicting events in the coming year is really easy. Here are some things I know for sure will happen in 2017:-


Adelaide and South Australia

Adelaide Will Excel If The SA Economy Shows Improvement

Adelaide will be one of the better performers of 2017. It just needs to overcome the perception that it’s a non-growth city. The evidence is there that South Australia and Adelaide are better economic performers that most people think, but convincing investors is another matter.

I see Adelaide as an under-rated market, which often surprises with the level of price growth achieved. In 2003-04 and again in 2007-08 annual price growth for Adelaide houses topped 20%. It’s overdue for another growth spurt.

Currently the city is benefiting from significant spending on infrastructure and its economy is likely to prosper in the near future from Defence business. There was also the news, late in 2016, that the SA economy grew almost 2% in FY2016 and is now worth over $100 billion for the first time.

In one respect the Adelaide property market is the strongest of the capital city markets. Adelaide has more suburbs with growing sales activity than any other city. While Sydney and Melbourne sales activity has dropped markedly in 2016, Adelaide sales volumes continue to rise.

Adelaide is also showing the strongest investment value among the five biggest Australian cities, according to a report by Performance Property Advisory. It says Adelaide has under-performed in recent years but a range of indicators suggest the city is moving into a strong growth phase.

“When comparing the pricing relationships in Adelaide and the other major cities, it shows value on every comparison,” says Performance Property director David McMillan. “The indicators, while slightly mixed, are pointing towards positive price movements in the Adelaide market.”

Positive indicators of growth for Adelaide include …

“Affordability in Adelaide is the best it has been since 2003,” McMillan says. “We’ve had income growth outpacing price growth over the past seven years. The city’s Affordability Index is very attractive for first-home buyers and this is a key positive for future price rises.”

Adelaide just needs more supportive data showing that its economy and population is growing. Investors are showing interest in Hobart because news has got through that the state economy has improved markedly and infrastructure spending has picked up.

Adelaide, like Hobart, offers affordability and good rental yields, particularly when compared to Sydney and Melbourne. It just needs to produce some economic good news stories to get investors interested.

There’s not a lot of excitement to be found in SA beyond Adelaide. Markets such as Port Lincoln and Whyalla have sparked to life in the past but currently there are few signs of growth.

Investors who are comfortable with risk and have an eye for opportunity should maintain a watch over Whyalla and Port Augusta. Both of these regional centres have been hurt by detrimental economic events in recent years and real estate values have fallen.

But both will grow again if plans in the pipeline come to fruition. In Whyalla, there’s a concerted effort involving state and federal governments to keep major employer Arrium alive and kicking – plus there are a number of resources-related projects in the pipeline.

In Port Augusta major energy projects may fill the void created by the closure of a coal-fired power station which was a key jobs generator.

Real estate is cheap in these towns and rental returns are good when their economies are firing. It’s risky investing but potentially lucrative if all goes well. If.


Brisbane and Queensland

Queensland Will Have Several Standout Markets In 2017

There are many good reasons to believe that Queensland is the place to be for property investors in 2017. If not the place, then certainly one of the places.

As we approached the end of 2016, there were signs of the following events emerging to positively influence Queensland property markets:-

In addition to that, there are signs of growing interest from property investors. A recent survey by PIPA asked investors, amongst other things, which market they now favoured for future growth. Half nominated Brisbane, while only 11% opted for Sydney. That result shows how much things are changing in major property markets around Australia.

Brisbane markets have been cantering along for the past couple of years without ever breaking out into a sprint. But as the Queensland economy improves, boosted by rising commodity prices, a strong tourism industry and a revival in population growth, Brisbane may start to deliver more in the way of price growth.

Investors need to be careful about the apartment markets in Brisbane, especially the inner-city sector, where vacancies are high and likely to get worse before they get better. There are also rising vacancies in some suburban markets because small to medium sized developers have been building lots of units and townhouses – too many – in suburbs like Albion and Chermside.

Beyond that proviso, Brisbane is a busy market with the potential to produce more in the way of price growth in 2017, if some of those signals mentioned earlier prove accurate.

We have also seen an uplift in sales activity on other key markets of South-east Queensland. The two most upwardly-mobile markets in Australia in the second half of 2016 have been Brisbane’s coastal book-ends: the Sunshine Coast and the Gold Coast.

Both the coasts are being boosted by strong local economies, major spending on infrastructure and highly-active construction industries. The outcome is a big increase in jobs and, arising from that, rising demand for real estate accommodation.

The Sunshine Coast rates more highly at present because, despite being a smaller city, it has more suburbs with growing sales activity than the Gold Coast does. The Sunshine Coast is being driven by over $20 billion in infrastructure and real estate developments and offers plenty of affordable real estate at good rental yields.

The Gold Coast has a very busy real estate market, with infrastructure spending a big factor, as well as high-rise construction, which is creating lots of jobs. The 2018 Commonwealth Games is providing some of the momentum.

Investors are urged, however, to avoid the high-rise markets which are heading for another bout of oversupply – and concentrate instead on the housing markets inland.

Toowoomba has shown growth in recent years and passed its peak a year or two ago. But it remains a  strong regional economy and may surge again on the back of infrastructure spending.

Regional centres which dived because developers over-built – and, in some cases, because the coal industry declined – may be at the bottom of their down cycle, or close to it. Reports from two different groups, SQM Research and Herron Todd White, have suggested that the worst may be over for locations like Gladstone, Mackay and Emerald.

Certainly, if the rise in commodity prices continues, that will help their revival, because a number  of mothballed mining projects are being transferred from the backburner as a result of that news.


Canberra and the ACT

Capital City Is Set To Rise In 2017, Supported By A Strong ACT Economy

The Canberra market undoubtedly improved in 2016. There’s evidence that rents are rising and that house prices have shown moderate growth. Expect bigger things in 2017 on the back of an improving economy – unless the Federal Government decides to give the public service another short back and sides.

Three major research sources – Domain, SQM and Residex – all record annual growth in Canberra house prices in the 4-5% range. The only source suggesting it’s been more is CoreLogic, whose figures continue to be criticised for being inflated (including by the Reserve Bank).

In terms of the Canberra apartment market, the various research entities suggest a small decline in values or a very small rise. This makes sense – the Canberra unit market recently went through a phase of over-supply and is just beginning to recover.

A key positive for Canberra is its low vacancy rate, which provides further evidence that the previous oversupply of apartments has been absorbed. According to Louis Christopher’s SQM Research, just 1% of Canberra rental properties are vacant (only Hobart has a smaller vacancy rate among the capital cities) and it leads capital city Australia on rental growth, with the Asking Rents Index up 9% for houses and 8% for apartments.

Property values in Canberra continue to be underpinned by the ACT Government’s close control on the release of land, which never keeps up with demand, which means prices are maintained at artificially high levels.

So, now that previous oversupply has been soaked up and the earlier impact from public service downsizing has been absorbed also, we can expect Canberra to be a pretty solid performer in 2017, with growth a little higher than the moderate levels of 2016.

Underpinning the property market is solid economy. ACT has been the No.3 ranked economy in the nation (behind NSW and Victoria) in recent years and the latest quarterly CommSec State of the States report has maintained that rating, helped by a strong rise in housing finance approvals.

The ACT also had the second-strongest overall economic growth in the nation, at 23% higher than the decade average.

Given that the underlying economy is a major influence on how real estate performs, it suggests a good year in 2017.


Darwin and the Northern Territory

Expect This To Be The Best Year For Darwin Since 2013

I expect Darwin to have a much better year in 2017 than the previous two or three – for clearly defined reasons.

Darwin appears to be nearing the bottom of the cycle, after three down years in which vacancies have been high and prices and rents have fallen. Some sources put the decline in Darwin house prices in the past year as high as 9% or 10%.

The $30 billion Ichthys gas project which helped to ignite the Darwin market in 2012 and 2013 has been winding down its construction phase and workers have been leaving town.

This process continues, but there is hope that other business and infrastructure events will generate economic activity and jobs, re-generating demand for real estate.

Reasons for optimism for 2017 include the recent change in Territory government, which has lifted confidence; the generous incentives now available to first-home buyers; the possibility of growing economic impact from Defence projects; and the general vibe in the market that the worst has passed.

When markets go through a down phase, it’s easy to forget that these are not normal times for markets like Darwin – which has often been a national leader on price and rental growth.

The reality is that the city’s economic and real estate fortunes are greatly influenced by the resources sector, which is itself highly volatile and cyclical.

Activity in the September 2016 Quarter hinted at better times for the Darwin market. The NT Real Estate Local Market report from the Real Estate Institute NT reported a rise in house sales for the first time in the year. REINT executive officer Quentin Kilian said: “Anecdotally our members are indicating sales activity is increasing slightly and certainly buyer activity – people at open homes – has increased a lot in the past month. We have also seen a small, but enthusiastic take-up of the new first-home owner incentives.”

The RELM report said house sales for overall Darwin (Darwin, the northern suburbs and Palmerston) were up 6.6% for the quarter but still down 17% in annual terms. I await further data before getting too excited.

There is also the suggestion that a change in government might provide a catalyst for brighter times in the Territory economy and Darwin property market. A recent report from valuers Herron Todd White supports that view. It says the change after the August election has improved market conditions in Darwin after 2-3 years of lower sales volumes and falling prices.

“Since 1 September the market has sprung to life again as the new first-home owner incentives for existing properties came into play,” it says.

First-home buyers are now eligible for up to $24,000 in stamp duty concessions, with the first $500,000 of the purchase being duty-free and the incentive being capped at $650,000. There’s a further incentive of $10,000 for renovations including up to $2,000 on household goods to further encourage people to buy existing properties. The incentive of $26,000 for building or buying a new property remains in place.

“Many prospective purchasers were waiting to see the election results before making any serious offers and have been quick to take advantage of the new benefits, some fearing it might push prices back up, particularly at the entry level,” the HTW report says.

There’s not much to talk about in Northern Territory real estate outside of Darwin – the only population centres of any size, Alice Springs and Katherine, are usually fairly solid markets but seldom do anything to set pulses racing.


Hobart and Tasmania

Investors Are Finally Waking Up To The Potential in Hobart and Launceston

The outlook for Hobart and other Tasmanian markets looks increasingly bullish. There has been a significant improvement in the state’s economy and it has received positive reviews from a range of analysts, including CommSec and Deloitte Access Economics.

The state’s tourism industry is delivering record numbers and other sectors, such as agriculture and construction, are strong. Record amounts are being spent on infrastructure across the state.

The Deloitte Access Economics Investment Monitor report says: “The value of Tasmanian engineering projects under way has stayed well above $1 billion and there’s just under $1 billion worth of planned projects in the pipeline.”

The biggest under way is the $535 million Midland Hwy update. Work worth $239 million is ongoing on the freight rail revitalisation statewide and there is a $40 million extension of the Hobart Airport runway. The report says commercial building is also “coming along well,” with $1.5 billion worth of projects under way and a similar pipeline of planned work.

“The $689 million Royal Hobart Hospital project is still the largest project,” it says. “Planned work has been boosted, with University of Tasmania plans to move its science-technology-engineering building to Hobart’s CBD, at a cost of $400 million.” The value of projects under way is up 27% to $2.9 billion. Adding planned projects, the total is $4.98 billion.

On the back of better economic news, Hobart is starting to produce solid growth in prices – one source suggests prices are up at least 8% in the past 12 months. There is also evidence of good growth in rentals.

Hobart’s great appeal is that it has the lowest prices, tightest vacancies and highest rental yields among the capital cities. Now, for the first time in a decade, all that is underpinned by a growth economy.

One forecaster, Simon Pressley of Propertyology, has predicted that Hobart will lead the capital cities on capital growth in 2017. I wouldn’t be too surprised if he’s right.

The latest figures from SQM Research indicate that Hobart continues to have the lowest residential vacancy rate in capital city Australia, at just 0.5%.

SQM’s Weekly Asking Rents Index records a 7.5% annual rise for houses in Hobart and a 5% rise for apartments.

Hobart, despite its tight market and recent increases in rents, is still the cheapest city for tenants. Typical rents are $355 a week for houses and $296 a week for apartments.

A couple of other Tasmanian markets warrant consideration. Launceston is the state’s No.2 city and is a solid economy in its own right. Similar to Hobart, Launceston has experienced an uplift in sales activity in the past year and looks set for a strong performance in 2017.

Not far from Launceston, the seaside town of Devonport is another busy market worthy of a look by investors seeking affordable prices and attractive rental yields in a location with potential for growth.

Devonport is a key port-based economy for Tasmania’s north and is the state’s entry/exit point for the regular ferries to and from Melbourne.


Melbourne and Victoria

City of Greater Geelong Set To Outpoint Melbourne On Growth

There’s often a tendency in these kinds of reports to focus on the major cities and ignore the regions. So I’m going to kick off Victoria by focusing initially outside Melbourne and feature the City of Greater Geelong. This is Victoria’s busiest and strongest market. The state capital has been thriving over the past two years or so, but is gradually fading – while Geelong continues to gather momentum.

Consumers who equate research with reading newspapers will possibly have a negative perspective on Geelong, because media has focused on the closure of a couple of major businesses, most notably the Ford motor plant. The reality, however, is that positive events in the Geelong economy far out-weigh the impact of the Ford closure. The jobs to be lost at Ford are outnumbered by the ones being created in other ventures by at least 10 to one.

There are major events still to come in the Geelong economic story, so I expect good performance in 2017. It’s a busy market, driven by its affordability relative to Melbourne, a strong local economy and a water-based lifestyle. Geelong currently ranks as one of the Top 5 markets in the nation, in terms of sales volumes and potential for price growth.

Meanwhile, just up the road, Melbourne has overtaken Sydney as the leader on price growth, according to most research sources. This makes sense, because Sydney has undoubtedly passed the peak while Melbourne is a little behind it in the growth cycle and still has some forward momentum.

The Melbourne market, in terms of sales volumes, has passed its peak too, but remains resilient and prices are still rising in many market sectors.

But the greatest impetus is now being found in the outlying areas where affordability, jobs nodes and good infrastructure are the key factors. Typical locations where this is occurring include the Epping precinct in the north, the Sunshine precinct in the west and the Casey LGA in the far south-east.

Unless you’ve been meditating in a cave in the Himalayas, you’ll know about the inner-city unit market and grim determination of developers to create a massive oversupply of apartments. If you value your money, stay well away from this market.

Some suburban sectors are joining the insanity and building too many major apartment complexes. Check out vacancy rates – and also building approvals in local areas – to avoid becoming a victim of the Melbourne high-rise mania.

Back to the regions, where Bendigo, Ballarat and some of the lifestyle towns north of Melbourne – including those in the municipalities of Mitchell and the Macedon Ranges – all have their merits, but Geelong is undoubtedly No.1 at the moment.

One region that may struggle – but then again maybe not – is the Latrobe Valley, where the Hazelwood power station will be closed, with 450 direct employees and 300 contractors to lose their jobs. The closure will end five decades of cheap, brown-coal-fired electricity generation at the plant. Hazelwood’s majority owner, French power giant Engie, will shut down the plant by March 2017.

The Latrobe Valley is regarded as one of the most disadvantaged parts of Victoria. Unemployment is reportedly 19% in Morwell and 14% in Moe. Both the State and Federal Governments have announced support packages for the region but the measures put forward to date will only partially soften the economic and social impacts of this move.

On the other hand, we have seen numerous examples around the nation of regional communities fighting back effectively in the wake of the closure of major businesses. Examples include Wollongong, Geelong and Newcastle.


Perth and Western Australia

Perth’s Three Years Of Struggle May Be Almost Over (Except For Inner-city Units)

There are some emerging indicators that the Perth market may have touched bottom, after a tough three years in which prices and rents have dropped amid rising residential vacancies.

I await further data to be sure, but I don’t expect Perth to fall much further.

Recent improvements in commodity prices have added to optimism in Perth. The Western Australian economy is highly dependent on fortunes in the resources sector and rising prices for gold and iron ore are a promising sign that recovery may happen. But the evidence to date is uncertain and a tad erratic.

But in the meantime most of the numbers portraying the Perth property market are negative. It continues to have the highest vacancies among the state and territory capital cities – by a wide margin. The 10%-plus decline in rents for both houses and apartments in Perth is by far the worst result of any of the capital cities.

And all major research sources have recorded annual decreases in property prices – ranging from 3.7% to 5.2% for houses, and from 3.3% to 7.8% for apartments.

The Real Estate Institute of WA is doing its best to generate optimism by putting a positive spin on whatever numbers emerge from the stuttering Perth market. It suggested recently that there’s good activity in Perth’s first-home buyer market, with half of all sales in the September Quarter occurring in the lower end of the market.

REIWA president Hayden Groves said September Quarter house sales activity was up 12% in the price range below $500,000 when compared to the June Quarter. “First-home buyers recognise that now is a great time to buy in Perth and are taking advantage of more affordable prices and lower interest rates to secure their first property,” Groves says.

There is undoubtedly an element of talking up the market in that comment, but it makes sense for first-time buyers to exploit the prevailing conditions: reduced prices, weak competition from other buyers and the low cost of finance.

WA has often been Australia’s strongest state economy but it’s now ranked as the worst in CommSec’s latest State of the States report. Better times may lie ahead, however.

Signs are emerging that WA’s mining industry is shaking off its malaise, with exploration activity surging. WA minerals explorers are reacting to high gold and lithium prices and boosting drilling activity. Department of Mines and Petroleum figures show applications for prospecting licences rose from 359 in the June Quarter to 653 in the September Quarter.

Increasing demand for prospecting licences is a positive sign but more important is the rise in “program of works” permits, which signal explorers are physically sampling areas. These applications rose 25% in the year to 30 September.

Business leaders, politicians and economists have welcomed the news, saying the increase in exploration is the first step towards economic recovery. The gold industry says the foundations are there for the industry to double in size over the next decade.

In the meantime, the resources-related towns in the north continue to suffer from dramatically falling prices and rents. The fall in values in locations such as Port Hedland, Karratha and Newman has been spectacular.

Newman’s median house price went as high as $750,000 but is currently around $215,000, while Port Hedland has dropped from around $1.2 million three years ago to $415,000 today.

Regional centres in the south, places not directly impacted by the mining industry, are proving to be more resilient, but there are no signs of growth anywhere in the WA property market.


Sydney and New South Wales

Lower Levels of Growth Likely But Sydney Market To Remain Solid

A discussion about what will happen in Sydney real estate in 2017 needs this qualification up front: the metropolitan area of Sydney is a vast city of over 700 suburbs. It’s not one market – different scenarios will be played out in 2017.

In 2016 we saw a general decline in sales volumes in Sydney. As a direct consequence of that, the rate of price growth slowed down. But, there are different things happening across this very big city. The tendency by media to distil market dynamics for a major city to a single growth figure is unhelpful and often misleading.

Our latest analysis of sales data reveals there is still a small number of Sydney suburbs with growth markets, a much larger number which we classify as “plateau” markets (have levelled off a little below the peak), a few that show consistency of sales over time, and a small but growing number categorised as “danger” markets.

That means various scenarios within the Greater Sydney Area.

Some of the key factors that drove the boom – the strength of the Sydney/NSW economy and the high level of spending on infrastructure – are still in place. So many markets are showing resilience.

But some of the other influences – the absence of major growth in the decade pre-2013 and the relative affordability it created – have passed into history. There’s no way that strong level of price growth could continue because, after three years, price becomes an issue for more and more people.

Many areas are still making good sales and maintaining strong prices, just without the double-digit annual growth of the recent past. This is one of the reasons we do not expect any significant decline in Sydney prices in the near future.

But there are exceptions. There are now suburbs classified as “danger” markets. They’re all locations dominated by apartments and where sales rates have dropped markedly, at a time when developers are bringing lots of new supply to the market.

In some of those standout locations, like Parramatta, the rate of sale is a third of the levels of three years ago. Practitioners who claim Sydney can build unlimited numbers of new apartments because the city has a dwelling shortage are deluding themselves and others. There are specific markets in Sydney heading for major oversupply, regardless of the overall supply-demand situation for the metro area.

The areas showing the most solidity in the face of the overall cooling of the market are headed by the City of Penrith. There’s still plenty of life in markets out in the far west – and this is typical of the Sydney places investors should consider to achieve growth in coming years.

Sydney’s property boom was caused by a number of core factors, including the overall strength of the NSW economy and the lengthy period without strong growth pre-2013. But the biggest single factor is the high level of spending on infrastructure. Tens of billions of dollars are being invested and that’s generated economic activity and jobs, while improving the amenity and/or accessibility of locations. Transport and medical-educational facilities are the big ticket items.

So the way forward for investors in Sydney is to follow the infrastructure trail – and, in general terms, that means looking west where the second airport is being built, as well as new motorways and rail links.

Municipalities like Penrith, as well as Blacktown and Liverpool, are the most likely beneficiaries.

Buying property that lies in the path of progress has always been a core method of making money in real estate – and that’s one of the keys for investors contemplating the inevitable wind-down in markets in Sydney.

However, in 2017 I would rather be buying in regional NSW than in Sydney. Prices are much lower, rental returns usually much higher and – if the locational choice is good – there are fine prospects for future capital growth.

And there are plenty of solid markets in regional NSW to choose from, including Dubbo, Orange, Wagga Wagga, Wollongong, Newcastle, Coffs Harbour and Tweed Heads.

One location that stands out because it’s recovering from a difficult period is the Hunter Region outside Newcastle. This has been a boom economy in the recent past and developers (as they so often do) dived into the Hunter en masse and oversupplied the market just as the downturn in the resources sector was taking hold.

The decline in the coal industry impacted the Hunter and high vacancies pushed down rents and prices. In 2016, however, there have been growing signs of recovery, with vacancies lower and towns like Muswellbrook and Singleton starting to fight back.

Adding fuel to the revival is the recent sharp rise in coal prices. If this continues, 2017 should be a good year for the economy and real estate markets of the Hunter Region.


In conclusion

Ignore Media And Conduct Genuine Research To Succeed In 2017

Whenever I speak to a live audience around Australia, as I often do, question time always reveals that consumers have their heads full of misinformation. Most of what people think they know about real estate comprises (mostly) myths and misconceptions.

This happens because most people think “research” consists of reading newspapers and absorbing information from other “normal” media sources. In reality, the smartest thing a real estate consumer can do to be informed about investment is to switch off all forms of mainstream media.

Few of the people writing about real estate are experts. Many are hack journalists with limited knowledge of the subject and most of what they publish is a shallow re-write of someone’s press release. They compound their ignorance by seeking analysis from non-experts such as economists.

So here’s my simple three-step formula for success as property investors in 2017:-

All the information a consumer will ever need to make informed choices exists and most of it is readily available through Internet research.

The problem is that often data from one source conflicts with figures from another.

How to make sense of it? Seek advice from qualified businesses. Be willing to pay for it. All the successful investors I know have this in common: they treat real estate investment as a business and understand that you have to spend money to make money.

Most mum-and-dad investors don’t do that – and end up with ordinary results.

Share this:

Subscribe to Neil's Consumer Alerts

Enter your email and each month we'll send you information and tips on the real estate industry and advice on how to avoid the tricks and traps when buying and selling homes.