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Empower Wealth Blog post by Empower Wealth

2015 Australian Property Market Outlook | Part 6 – Summary

So we’ve gone through the property market of each states across Australia and we’ve discussed about the investment opportunities in the metropolitan and regional area. If you’ve missed out on the earlier parts, here’s the list:

Part 1: Property Market in Sydney and Regional NSW
Part 2: Property Market in Melbourne and Regional VIC
Part 3: Property Market in Brisbane and Regional QLD
Part 4: Property Market in West Australia, South Australia and Tasmania
Part 5: Property Market in Northern Territory and Australian Capital Territory
Part 6: Summary of Australian Property Market in 2015

But overall, how is Australia performing as a whole and what can we anticipate for 2015? Watch this Australian Property Market | Summary to learn more.

 

2015 Australian Property Market | Summary [Transcript]

 

Ben: OK. So let’s wrap it up if we can in a macro sense. What we’ve actually got is different marketplaces in different paces of growth and some coming off their steady or strong pace of growth. They’ve got slowing growth.

Other areas where we actually believe the stories with low interest rates, they’re going to continue to see some pretty strong growth because it’s an affordability story for them. They haven’t seen that sort of confidence score, put the marketplace into a buying frenzy. So we see some opportunities in those particular marketplaces as well.

So I think Bryce summed it up beautifully. Yield is going to tell the story in this particular market by the sense that we will probably chase a bit of yield with some backup growth on it for most of our clients depending on their personal circumstances and in the broader city markets, we aren’t going to be buying that emotionally-charged property which we would buy kind of cyclical.

Let me quickly explain that. Emotionally-charged asset is the one that’s fully complete. It’s the walking. It has got all the bragging rights. The people can actually dream about the cocktail parties and the dinner parties that they’re going to have there. It’s all about status and perception and so that stuff, when you’re in a strong market, you don’t touch it because you pay a premium for it because you’ve got 10 owner occupiers buying against you.

So we would still be buying a select type of property under that that has that uplift in terms of improvement of the asset. But I wouldn’t be buying that because you will be sitting on that asset for the next three to four years with no price growth and you would be wondering, “Why am I paying interest on this and not getting what I’m looking for in terms of the capital growth play?”

Bryce: I think it’s an important point that you raised here and the fact that we just spent the last 15 minutes talking about how Australia is so different about where the cycles are. I would say for 2015, for the people watching this, is to just be mindful of the headline because quite often the headline is talking about generalised markets. Don’t invest in Australia. Don’t invest in Melbourne but we really are buying localised properties in localised markets with localised conditions.

So I think that’s really important to consider and we’ve probably thrown a few generalisations in ourselves …

Bryce: But in terms of – we’re saying Brisbane is a marketplace to consider but we’re very, very conscious of the fact that on the ground, there’s certainly stuff we would ignore and there’s certainly stuff that we would embrace.

Ben: Yeah.

Bryce: And we’re going to buy some more stuff in Sydney and we’re going to buy some more stuff in Melbourne. So I suppose that’s the message. What’s also exciting that I would like to share with you now is some of the research developments we’re doing in our business around our new property software estimator and predictor.

We’ve spent a lot of money and time in sort of doing this research analysis and we’re doing some regression analysis in terms of the work. We call it our property vault. So have a look around the website and also potentially on the net for our Empower Wealth Property Vault. It will give you an insight in terms of some of the research we do to try and get that predictive modelling to find those next areas that we’re going to go into to help our clients.

Bryce: Yeah. So I guess if you’re an investor who’s a do-it-yourselfer, I would encourage you to go to our website and look on the Education tab because we’ve done quite a few videos now. We will be adding to them all year on what we think are the insights and the principles when it comes to property investing.

So if you’re a do-it-yourselfer, feel free to check into our education tab and if you haven’t sort of signed up for our newsletter, feel free to do that because we’re going to send those out. So you get an advanced notice on any new material that we’re actually sending out.

On the flipside if you’re an investor, you might like some help. Why don’t you leave your details on our website www.EmpowerWealth.com.au and we would certainly be happy to chat to you and talk about your unique circumstance to see what opportunities actually exist for you. So good luck in 2015.

Ben: Yeah, look, all the best in a challenging market. You got to know your stuff. You’ve got to do your research if you want to get results in 2015 in the property market. So thanks very much for watching.

 

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