Webinar Replay - Why Melbourne Makes More Sense Than Perth
Hotspotting
Want to get into a key market BEFORE prices start to take off? Feel that you may have missed the boat with media favourite Perth? In many ways, the answers to these questions are the essence of smart investing. Most property investors are herd animals, diving into markets when they read that prices have risen 15% or 20% in the past year – or 50% in the past three years. Buying in such a market means you are likely buying at – or after – the peak of the market. The smart money would have been there 2-3 years ago – and is now focused on places that are early in the growth cycle....
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Interviews with the 1% - Arjun Paliwal of InvestorKit
Hotspotting
Are you ready to take your investment journey to the next level? Look no further, because we have exciting news to share with you! We are thrilled to announce our new Hotspotting pre-recorded interviews with some of the top 1% of Australian investors who own 5 or more properties. As you may know, in the 2020-2021 financial year, only 0.87% of investors in Australia owned 5 or more investment properties. But what do these successful investors know that the majority don't? We have sat down with a number of them to get exclusive insights into their strategies, tips, and personal journeys. Our...
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Real Estate Influence on RBA
Hotspotting
Part of the obsession by economists with interest rates as the only thing that matters in the housing market is the notion that the Reserve Bank spends a large amount of time discussing the housing market before deciding what to do about interest rates. As with so many things, economists are wrong about that. One of the most popular definitions of insanity is doing the same thing over and over again, but expecting a different result. My own definition of insanity is the average Australian economist discussing real estate. In essence, those two definitions are essentially the same thing....
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First Home Buyer Activity
Hotspotting
If you tune into news media regularly, it’s easy to form the view that the prospect of young Australians buying real estate is remote, if not impossible. There are daily headlines telling us that it takes 10 or 15 years to save a deposit, or that most young Australians have given up on home ownership and that young adults are doomed to a life-time of renting. As is so often the case with mainstream media and their love of negative sensation, the reality is quite different. First home buyers are highly active in markets across Australia. But first, let’s look at some of headlines with which...
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Home Building Costs
Hotspotting
Want to know why housing affordability is so poor in this country? The answer, in simple terms, is because the cost of building new houses is so high – ridiculously, obscenely high. The cost of building the typical house in Australia has risen 53% in the past three years – and it now costs close to half a million dollars to build that home. And that’s just the cost of the house. It doesn’t include the price of the land. Who’s to blame for this situation? Primarily, overwhelmingly, it’s government. Politicians and bureaucrats. They keep...
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Regional vs. City Growth
Hotspotting
We’re constantly asked at Hotspotting whether it’s better to invest in the regions or the capital cities – and whether you get higher capital growth in the outer-ring suburbs of our cities or the so-called prime inner-city locations. Now, there’s no definitive answer to questions like that, because there are so many different scenarios to consider – and, at the end of the day, it comes down to the performance of individual local markets and you simply cannot generalise. But, based on the evidence of where the highest capital growth has occurred in the past four years, I would have to...
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Victorian Markets
Hotspotting
The smart money in real estate buys in key markets BEFORE prices start to take off. The essence of smart investing is NOT buying in over-heated markets like Perth but targeting locations that have the credentials for long-term growth but are currently at a low point in the cycle. And right now, the location that meets those criteria better than most is Victoria, particularly Melbourne. Most property investors are herd animals, diving into markets when they read that prices have risen 15% or 20% in the past year – or 50% in the past three years. Buying in such a market means you are likely...
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Interviews with the 1% - Matt Wilson
Hotspotting
Are you ready to take your investment journey to the next level? Look no further, because we have exciting news to share with you! We are thrilled to announce our new Hotspotting pre-recorded interviews with some of the top 1% of Australian investors who own 5 or more properties. As you may know, in the 2020-2021 financial year, only 0.87% of investors in Australia owned 5 or more investment properties. But what do these successful investors know that the majority don't? We have sat down with a number of them to get exclusive insights into their strategies, tips, and personal journeys. Our...
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How To Multiply Your Wealth With Subdivision
Hotspotting
Many Australians grow their wealth through passive investment in real estate: buy a property, install a tenant and wait for growth. There’s a better, and faster, way – without high risk. More and more investors are using development strategies to accelerate the wealth-creation process, with small subdivisions one of the most accessible and successful. Wealth mentor Brad Cassidy of The Kaizen Way teaches these strategies to investors across Australia, with notable results. Recently, our Hotspotting founder Terry Ryder hosted Brad on a webinar to discuss how to profit from small...
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Apartment Revolution in Real Estate
Hotspotting
At Hotspotting we’re always on the alert for evidence of CHANGE that will influence property markets. The great potential in residential real estate is that change is always happening, opening up new possibilities for growth. One of our catch-cries at Hotspotting is that THE PAST DOES NOT INFORM THE FUTURE. Poor performers of the recent past can become the nation’s leaders of the near future. One of the biggest trends we are tracking, under the general theme of change, is the rise and rise of apartments – challenging the dominant paradigm of real estate. That paradigm, still widely...
info_outlineSeven of the eight capital cities delivered growth in their house prices during 2020, according to the latest data from CoreLogic.
The price increases were highest in Darwin, which grew 12% last year, followed by Canberra’s 8.5%, Hobart’s 7.7% and Adelaide’s 6%. Melbourne was the only city to record a decline in its median house price, down 2% in 2020.
Sydney (up 4%), Brisbane (4.6%) and Perth (2%) all recorded moderate growth in their house prices, in a year when most of the nation’s cities defied the pandemic and its negative economic impacts.
The average growth figure for the combined capitals was reported by CoreLogic as 2.6%, a number that seems unreasonably low given that six of the eight cities had growth considerably higher than that.
Apartment markets did not fare as well as houses, with four cities delivering price growth, two recording no change and two (Brisbane and Sydney) having small declines in their median un it prices. The combined cities average was a rise of 0.2% in 2020.
So the capital cities did pretty well in the pandemic year, especially the smaller ones …
BUT …
Regional property markets across Australia out-performed the capital cities – and by a considerable margin.
CoreLogic data shows that the result for the Combined Regions was a rise of 7% for houses and 6% for units, compared to 2.6% and 0.2% for the Combined Capital Cities.
House prices rose 12% in Regional Tasmania (compared to 7.7% in Hobart),
8.8% in Regional NSW (compared to 4% in Sydney),
7.8% in Regional South Australia (compared to 6% in Adelaide),
7.3% in Regional Queensland (compared to 4.6% in Brisbane) and
5.5% in Regional Victoria (compared to a 2% decline in Melbourne).
Unit markets also did well in the regions, with price increases headed by South Australia (up 11.7%) and Tasmania (up 10.5%).
NSW, Victoria and Queensland all recorded unit price rises between 5.5% and 6.5% in the regional areas.
The only regional market to record price decline was Western Australia, which dropped both for houses and for units.
So, overall, an amazingly positive result for property prices in a year that threw up all kinds of hurdles – and in defiance of the negative predictions by economists and journalists.
All this was achieved without a great deal of involvement from investors.
And that’s one of the things that will be different this year.
Stand by for a big big year in residential real estate in 2021.