Mining Back On Solid Ground?

Mining Back On Solid Ground?
An Editorial By Phil Anderson • Tuesday December 6th

 

A once left for dead economic powerhouse is looking to playing the role of Lazarus with the mining industry attempting to rise from the grave. The real effects of this resurgence for certain smaller property markets could be significant, particularly for one of Sydney’s closest neighbours who may benefit in a big way.

The Daily Telegraph released an article just last week stating that the mining industry seems to be breathing new life into the Hunter region just north of Sydney. This is largely due to a huge rebound in Iron Ore prices, as well as the ever growing demand from Asia for our home grown resources.

One of our key criteria for selecting strong candidates for property investment is job growth in the local area, which helps fuel demand for local property and lowers vacancy rates. The larger Hunter region has seen it’s unemployment rate drop from 11% to 5% thanks to many dormant projects reopening, including 4 mines creating 575 jobs on their own.

While this all sounds very exciting for Newcastle / Hunter Valley based property markets, this new information needs to be taken under advisement. In the past, my voice has been one of the loudest, warning many of my followers of the potential pitfalls the previous “Mining Boom” contained. While enticing, to me the warning signs of a collapse were obvious. Some people listened and found other great markets to invest in. Others did not and sadly, lost everything.

Currently I am seeing even larger warning signs than I did during the last mining boom in other seemly “strong” property markets right now. I am giving a “tell all” presentation at my free event this evening in Manly for all those who care to listen and prepare themselves for what is coming next.

The important thing to focus on is not just new jobs in any given area, but a sustainable growth framework that will continue to create new jobs years into the future.

Asia’s demand for our coal is impressive, with exports at near record levels thanks to Japan, Korea, Taiwan, China and India all desperately needing the resource.

However, warning signs can often be heard in the ears of A-Grade investors when a market only has one major source of employment. It’s important to understand that strong growth markets are made from multiple economic drivers with a long term investment into the local community.

Our proven criteria for property investing has allowed us to boast a 100% success rate in picking growth markets right around Australia. My team and I have helped more than a thousand local Mum & Dad property investors over the past decade build wealth by investing in excellent cash flow properties located in safe and reliable markets

To learn more about how we research and identify these markets for our clients, as well as some of the big changes I see on the horizon for local and National property markets, come to my final free live event for 2016 tonight at the Stone office in Manly. Click here to register.

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