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Terry Ryder's Tuesday Wrap 25th February 2020

Hotspotting

Release Date: 02/27/2020

Real Estate Thrives On Disruption show art Real Estate Thrives On Disruption

Hotspotting

As a research analyst on Australian housing markets, and a strong advocate of residential real estate as an investment, I always feel more optimistic when we are in periods of economic disruption – as we are right now. Recent share market collapses have reinforced once again the relative safety of bricks and mortar - and provided a reminder that real estate often thrives in times of widespread economic disruption. Recently Australian shares dropped to their lowest levels in months. Although many of those losses have since rebounded, we are undoubtedly in a period of volatility in share...

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Property Prices Are NOT Driven By Interest Rates show art Property Prices Are NOT Driven By Interest Rates

Hotspotting

Here’s what passes for analysis in Australian real estate: if Event A coincides with Event B, then Event A must have caused Event B. This is what I call kindergarten analysis and we get a lot of it in the housing market. It ignores the reality that there is also Event C, D, E , F and G taking place – and some of those may have had an influence on causing Event A. The worst example of this shallow analysis is playing out in mainstream media every day at the moment. Event A is rising interest rates. Event B is that prices, apparently, are falling in some markets. According to most economists...

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Affordability Drives Demand show art Affordability Drives Demand

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Property markets are always evolving and reacting to changes in the economic climate – and the biggest trend currently evident across Australia is that buyers increasing are chasing affordability. In most of our capital cities, it’s the affordable suburbs where buyer demand continues to be strong. And, at the same time, investors continue to buy in affordable regional locations that offer higher yields to compensate for rising interest rates. Our quarterly analysis of sales activity for The Price Predictor Index shows there are still many supercharged suburbs and towns with increasing...

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Growth Markets Remain Across the Country show art Growth Markets Remain Across the Country

Hotspotting

There’s a lot of media speculation around about the downturn in what economists call “the Australian property market”, with doomsday predictions for house prices - but when you look at the actual data, that’s far from the reality. There continue to be growth markets right across the country, as well as some which have been in decline since last year For the Spring edition of The Price Predictor Index report, we analysed thousands of housing markets throughout Australia to determine the patterns with sales activity, which means buyer demand. Find out more in the new . Out Now!

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It Pays Not To Generalise show art It Pays Not To Generalise

Hotspotting

The greatest source of misinformation about real estate – and the scourge of consumers trying to figure out what’s happening in markets across Australia – is generalisation. And by that I mean, economists and other commentators speaking about Australia as a single market or about a major city as if there is just one scenario happening across the entire metropolitan area. The Spring edition of depicts a number of important instances where it pays NOT to generalise – because there are markets within markets.

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How The Rental Crisis Evolved show art How The Rental Crisis Evolved

Hotspotting

The nationwide rental shortage crisis may appear to be a Covid phenomenon, but it’s something many in the property investment arena saw building for a long time. Years of constant changes to real estate investment regulations and taxes have pushed many investors out of the market, with the current shortage of properties for tenants the result.

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Politicians Are To Blame For Housing Woes show art Politicians Are To Blame For Housing Woes

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All the core problems confronting the housing market can be blamed on politicians. Whether it’s the housing affordability issue, the rental shortage or builders going broke in the middle of a construction boom, the short-sighted decisions of politicians are the underlying cause.

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Who Do You Believe? show art Who Do You Believe?

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Media, economists and banks love to predict disasters for the property market - but it's astounding how consistently they are wrong. Here are some (incorrect) predictions from the last couple of years.

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How To Choose High-Yield Properties show art How To Choose High-Yield Properties

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Right now, many property investors are seeking locations with above average rental yields. Buying properties that offer a positive cashflow situation is always a good idea, in my view, provided the location has the credentials for long-term growth. But now more and more investors are looking for superior rental yields – because interest rates are rising, and may rise further. Finding those positive cashflow scenarios has become harder, not only because borrowing costs are rising, but also because recent strong price growth has pushed down yields. This may encourage some investors to consider...

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Most Market Jurisdictions Still Have Rising Prices show art Most Market Jurisdictions Still Have Rising Prices

Hotspotting

Real estate markets across Australia remain busy, with solid price outcomes, with a couple of notable exceptions. While media headlines have suggested that market decline and falling prices are widespread, our research shows this is not the case. Our latest quarterly analysis of sales activity shows that most capital cities and most major regional markets continue to deliver busy markets with little evidence of price decline. Our examination of all the price data that’s available from multiple research sources indicates that there are actually very few markets where prices are falling. Most...

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More Episodes

In my column on Property Observer this week, I discuss how to understand the different real estate markets and what causes them - it's a lot more than low interest rates.