If you are considering buying residential in the foreseeable future the market will present an opportunity to purchase quality stock in quality areas over next 2 years.
Nationally office, industrial and retail property prices remain very strong on the back of strong investor demand, particularly from Chinese and Asian investors. Generally, rents in Melbourne and Sydney are rising and vacancy rates falling whereas in the resource based states of Perth and Brisbane conditions are weaker. The completions...
The number of properties on the market with “residential development upside” increases every week. Nearly all have approved DAs. Essentially they are devlopers trying to exit positions. My criteria in assessing these properties is they have to be income producing for a period that will get through to the next recovery in the residential market. Then the underlying developed land value must exceed the intrinsic worth of the commercial investment otherwise when you develop the site you are destroying investor equity.
The Australian Financial Review reports that apartments in central Melbourne are being resold at up to 30 per cent less than their off-the-plan purchase price.
Is the Australian residential property market so overpriced that we should be shorting our banks? Or is it reasonably priced because of low interest rates? In attempting to assess residential property’s fundamental worth we need to recognise that residential property has two very different functions - as a home providing safe shelter and as an investment providing a return.
There is no question that negative gearing artificially increases demand resulting in higher prices. The problem is that turning it off will reduce residential prices.
The increasing product range of Coles & Woolworths has reduced the number of specialty retailers that can "hang-off" a supermarket, potentially making many older neighbourhood centres unattractive investments.
Property Valuers are often perceived as being out of touch because they "value" our properties for less than what we think they are worth to procure finance; yet most Property Valuers do not estimate a property's true intrinsic value at all.
In attempting to quantify mortgage stress we impassively talk in economic units such as household income and house prices. However to really understand mortgage stress we need to consider a home instead of a house and a family instead of a household.