Went to the show today. Here are some notes my wife took down.
What To Buy - My Ten Rules For Better Investment Buying By Michael Matusik
1. buy new, buying value
• small project
• prime location
• wheat, work health, education, a...?, transport
• economic pillars
• five or more pillars, not just mining
• accumulative numbers with population growth. Ask and understand the numbers, not just percentage.
• rising workforce, not just unemployment number
5. Design
• perception and use of space
• sharing space too for rentals
• bedrooms equal size and bathrooms
• storage & cars
• noise, privacy and a view
6. Demographics
• not you living there
• live out, not in the property
• white goods and furnishing the property ESP for rental
• singles, couples, groups
• rental is non traditional
• couples no kids
• single parents
• townhouses,
7. Purchase price
• under 600K, preferably under 450-500K. Move a suburb out to afford it.
• wider resale
8. Supply
• local context
• ten year timeframe
• potential trends and sites
9. Proven team
• previous projects
• who is managing the property
• default/ repair policy
10. Local upside
• mixed-use location or will be in the future. Work, rest and play.
• infrastructure plan
• local improvements
• business success
• high recall index, always visit and stay for a couple of days.
Hold for 2 cycles. 10-15 years
Understand your tenant.
Question about OTP:
Buying off the plan can help negotiate with stamp duty, or furniture packages etc, buys time, need to be careful. Not price negotiating.
PROPERTY UPDATE 2012 By Margaret Lomas
Economic factors
• gross domestic product
• gross regional product
• unemployment trends
• jobs growth usually equals economic growth
• industrial and commercial property markets
• services must also grow, otherwise no long term health in the area
• housing starts in the last quarter indicates population growth
• strong leadership at council level crucial driving force behind ultimate economic growth.
State by state
NSW
Sydney housing shortage 130,000
Rental vacancy rates decreasing 1.6%
Rental growth to accelerate already up 5.9%.
Houses forecast to grow at 3% Sydney and 5% in regional I.e Bathurst
Apartments growth less than 1%
VIC
House prices coming off 2011 highs, 3 years of flattening out
Rental vacancies are higher than Syd 2.3%
Ballarat and bendigo 5% forecast
Vacancy rates increase
QLD
Mining towns growth
Non mining stagnating and starting to fall.
Houses in Brisbane suburbs to grow 2%, cbd flat
Apartments fall up to 10% due to oversupply which is not diminishing.
Regional areas with mining influence growth 8-10%
Toowoomba
SA
rental vacancy is the lowest in australia
Growth 3-5%
Suburb growth 5%
WA
Trended down
Increase in rental yield, but not growth
TAS
flat
Vacancy growing
NT
Vacancies should decrease
No major increases
ACT
Highest disposable income
Values flat
Flat vacancy
Cbd poor choices for next two years
Hot spots
NSW
Hunter valley, Orange, Bathurst, black town
VIC
Ballarat, bendigo
Melton Geelong
QLD
Toowoomba
Radcliffe, bundaberg rockhampton
SA
Port noarlunga port Adelaide
WA
Rocking ham, Armadale
Not TAS, nt, act
Market timing is the key, verge of its boom and boom occur during period of ownership. What drives economy?
Why most investors FAIL to build a multi-million dollar property portfolio BY Bryce Holdaway
More than 3 property required.
1. Treat property as a business NOT hobby
• pick the right asset. Investment is a process, not an event.
2. Don't listen to media hype
3. Australia is not one big market.
• huge market to be treated differently with each sub market
4. Understand how to afford multiple properties
• equity fund as a form of cash flow
• family budget
• strategic use of finance ??
• minimise interest repayments
• need a property savvy financial analyst
5. Be mindful of future trends
• lifestyle culture.
Smaller space to get the lifestyle
Workforce will change. Land value is more important, not size of land.
Scarcity. Not highrises.
6. Buy the right property.
• owner occupier appeal
• most important person is the valuer for buy and hold strategy.
7. Have a reliable blueprint
