Property Winners and Losers in 2016

State Of The Nation Report

You heard it here first "Cycles within Cycles". In this post Phil uncovers the property winners and losers in 2016 and reveals the truth about unit over supply, vacancy rates and why within one suburb some property types will be winners and others losers in 2016 and the impact of this phenomenon alternative locations and in particular the big shift to the emerging outer suburbs. downloadbutton_02

Transcription

Hi, I'm Phil Anderson from LifeCorp, the home of street smart property investors. For many years, the Great Australian Dream has been to own a free-standing family home. Well, today, in the Australian property market, I'm noticing a very important shift. And as a property investor, it's those shifts that I like to know very well. I like to be able to track what's happening, what the movements are, to be able to put my investment strategy right in the path of that shift. Today, we're gonna have a little talk about the changes in property types, the effects that are happening by oversupplies in others, and a trend back towards the family home.

So, one of the big questions is, how the heck - and I can hear you all saying it now - how the heck are families going to be able to afford to buy these family homes? Well, I think we're going to see a new trend. We're already seeing it now, just, most people don't realize, that a lot of people did turn towards buying inside of units, realizing that the lifestyle isn't what they hoped. And the density that's being created in their local area is making parking and lifestyle and a whole range of other things really not that family-friendly - certainly not what they hoped they'd be able to give their kids. Many people have targeted certain sorts of suburbs, certain suburbs, certain schools, and so forth; only to realize that the catchment area for the schools is shrinking and shrinking, and they may be missing out on those schools at any rate. A whole range of things that I'm seeing and hearing firsthand.

Now, the reality is, I do believe, the swing is coming back this way. Many Aussie families are now starting to say, "Wouldn't it be great if we could live in a community with family homes being the core property type in those particular areas?" Now, I believe what we're going to see over the next 10 or 15 years is the real emergence of great, quality outer suburbs. I believe areas that are west of Sydney and west and so forth, in the outer suburbs of Melbourne, are gonna become incredibly desirable lifestyle areas for middle-income families, quality families.

So, I think there's gonna be a change. Now, what does it mean to the Australian property market today? Well, I'm already seeing it today. I'm already seeing a lot of people move towards this. Now, as an investor, these properties can be secured and the holding cost can be 0, pretty much, from day one. If you're paying any tax and you know how to make these investment choices, really smart investment choices, this shift can really play incredibly well for an investor. Whereas, back this way, where a lot of investors have been sucked into by marketing teams, vacancy rates are climbing. In many areas, vacancy rates are hitting 10% or even more, as far as vacancy rates go. And there's tens of thousands of these units still to be completed over the next few years. Where many suburbs that have family homes, 2% would be high. Many suburbs that I target have less than 1% vacancy rates. In some markets - one of the top most in-demand property markets in Australia today - has less than 1% vacancy rates. Some local property managers would say it has 0% vacancy rate.

This is where it's all at. These are the property types that are really in demand at the moment. People want this. And people want to make sure that they can give their families a great lifestyle. Even the retirees coming out of the Sydney and Melbourne property market are still targeting quality family homes with very easy-to-manage environments. There's a whole range of criteria, but the reality is, there's a great opportunity in this world today. And also, a great opportunity to avoid quite a bit of carnage I think will be created in the unit market over the next two, three, four, five years. For example, the Brisbane property market, which could offer some of the best capital growth over the next three years or so will have what I call cycles within cycles. We will see for the first time some property types - let's say the free-standing family home - have quite good growth, whereas in the same area, the same market, it's these units that could actually have a negative property growth. I've never seen that before. We will see some of the best areas of Australia with some property types going this way, and other property types going that way, purely because of oversupply creating real headaches.

Now, there are a couple of different things that are happening that really make, like I said, the Great Australian Dream really come back into focus. These suburbs have certain criteria. They must have a high percentage of owner occupies. They must have great employment in the local areas. No good going out to an outer suburb where there's no jobs. Needs to be associated with still good access to employment, good access to major transport, rail, road, whatever that may be, certainly an owner-occupied environment. I hate some of the subdivisions I see the marketing teams putting their people into, where they're a high percentage of renters. It's just not great for capital growth. There are a number of criterias you must be aware of.

I've put together a report. This is a major shift, in my eyes, and it's a shift to be very aware of. Getting away from where I think the big problems could be for investors, not just the holding costs. When they go to settle, will the property even value up? If you take an option to buy a property that's not gonna be built for two years, what's the val gonna be at the end? Is the loan gonna hold itself up, or is the bank gonna say, "Look, you paid too much. You need to cough in another $100,000 or something." Please, be very aware of the risks in this category, and the popularity, the growing popularity of this particular product type category.

I've put together a free report for you. It's my State of the Nation report, it's my spring report, and it’s yours free of charge. It will cover this and a number of other shifts that I'm seeing around Australia. I've also got an upcoming tour coming in November. You may want to choose to come along and hear all of my thoughts on the Australian property market as a buyer. I'm an investor like you, so I like to watch what's happening, the trends and so forth. But grab my free report, it'll give you some details of my upcoming tour as well.

I hope you enjoyed this, and I hope you really enjoy my State of the Nation report. I think you'll get some great facts out of it, some great ideas as to what's really going on on the ground in the Australian property market.

At the end of the day, if you're gonna buy this, or any property you choose, please do it based on numbers. Protect your families. And protect the hard-earned income. You've probably worked hard to create an equity position in your own environment, allowing you to think about buying an investment property. Don't risk it. Do the numbers. I always say, if you can't buy this property with your lunch money, don't buy it.

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