Good Valuations - Adelaide

[duncan_m]

I'm currently restructuring some of my debt.. so the usual ringamarole of valuations are being done.. (nervous tenants worried about sales, organising appts etc).. I'm being pleasantly suprised by the results of the valuations.. VERY reasonable, almost in line with my own "market valuation"..

Low doc lender and using a Valuer that I've not had used for my properties before (PM me for lender/valuer name if you're interested). I thought with some of the doom currently around that they'd be way down!

 

[stargazer]

Hi Duncan

I've had valuations done recently and had a similar experience with the valuations.

cheers
BC

 

[Rolf Latham]

Huya Dunc

Its generally not possible to play ith vals. Mortgagees demand that the valuer use comp sales generally no older than 3 to 6 mths, so the good news is the vals probably represent market !

ta

rolf

 

[Kennethkohsg]

Dear Rolf,

1. I've attended John FritzGerald's seminar this evening in Perth. John mentioned declining population growth in Adelaide and told his audience to stay out of investing in Adelaide.

2. According to John, the 2 states still worth consider investing into, are Perth and Brisbane/Queensland. This is due to their projected high population growth and better housing affordability in these 2 States. Housing prices for Sydney and Melbourne are expected to fall further at the end of this year.

3. For your further comments,please.

4. Thank you.

regards,
Kenneth KOH

 

[duncan_m]

Huya Dunc

Its generally not possible to play ith vals. Mortgagees demand that the valuer use comp sales generally no older than 3 to 6 mths, so the good news is the vals probably represent market !

ta

rolf

Hi Rolf,

My last round of valuation (a year or so ago) were quite low, the Valuer used really bad comps. There appears to be only 2 firms that all banks in Adelaide use.. thankfully "Firm 2" seems more "aggressive" ?

So it would seem worth it to have the choice of valuer impact on your choice of lender in Adelaide at the moment..

 

[willair]

I thought with some of the doom currently around that they'd be way down!.
Ducan m,

just goes to show over time it all starts to work on your side.
imho, Brisbane in several small areras is still on the catch up
but but with the adverse factors such as noise and increased
traffic congestion in inner city areas, just stay away from
any properties near the freeways.
good luck
willair..

 

[ArJay]

1. I've attended John FritzGerald's seminar this evening in Perth. John mentioned declining population growth in Adelaide and told his audience to stay out of investing in Adelaide.

Hey Kenneth,

As much as I respect John Fitzgerald’s opinion on the investing opportunities in Adelaide, I still feel that there is a lot to offer here. I’m always sceptical when the “gurus” offer up such broad sweeping statements such as this, yet in the same breath talk about the specific due dilligence and research needed to find individual property deals. There are suburbs in Adelaide that have far out performed the growth medians from all state capitals over the past 10 years, and I’m sure this is the case in all capital cities.

In respect to our population, we are not (contrary to opinion) shrinking. I have been hearing this for years. The population growth in Adelaide hasn’t been on par with the other larger capital cities but we do have slow but steady growth. We seem to get a larger amount of immigrants into our state and IMO this adds to the stability of our rental market, of which has some of the lowest vacancy rates in the country.

Taking such a macro view of an area is not a healthy habit for any investor IMHO, but that’s just me. There’s no shortage of good housing stock here in SA if you know where to look and you have your finger on the pulse of the market. I'm biased I guess firstly living here, and secondly not being of the type of investor who's keen to buy outside of areas I can't do my own research leg-work in.

But hey, who knows...with the climate changing so rapidly, we could be the next Gold Coast in about ten years . That'd make things interesting!!!

Take care.
ArJay

 

[geoffw]

Don't forget that the average household size is declining (divorces, more singles etc)- but peoples' expectations are growing (newlyweds buying 4BR houses). I don't know how supply is growing or declining either. There's a lot more things than population growth which lead to increased or decreased demand.

 

[Aceyducey]

Arjay,

The term was 'declining population growth'. Meaning that the population was growing at a slower rate.

This statistic in isolation is of no value in determining property trends.

You need to look at the supply side and household sizes as well.

If the supply is low and the trend is towards smaller households, a slower population growth does not mean less property opportunities.

In any case there are only so many properties in the places where people aspire to live and more people aspiring....

Cheers,

Aceyducey

 

[Kennethkohsg]

Dear Arjay,

1. Are the population growth statistics like for Adelaide? The declining popluation growth for Adelaide, as mentioned by Jihn, was being projected by ABS from 2005 into 2051.

2. I was told that Adelaide used to have a declining population in the past;- but that all these have changed recently for the last 2-3 years, following the Chinese immigration surge into Adelaide from mainland China. Most of these Chinese immigrants have chosen to stay in Adelaide unlike the past immigrants who subsequently relocated to the other Australian states.

3. I was further told recently that this sudden increase in the Chinese immigration trend into Adelaide was the main reasons for the recent house price surge in Adelaide.

4. I hope to go over to visit Adelaide oen of these days and see things for myself.

5. Thank you.


regards,
Kenneth KOH

 

[Fester]

Who cares what Mr Fitzgerald says, I'm still in front!!

http://www.theadvertiser.news.com.au/common/story_page/0,5936,15522555%5E913,00.html

 

[Kennethkohsg]

Dear Fester,

Though you may in front presently but I wonder for how much longer in the Adelaide property market?

Please understand that as an overseas investor in the Australian property market, I am trying to do my own due diligence and to differentiate the truths about this particular market from the surrounding market noises and rumour-mongerings.

I guess it is better to be safe and well founded on the property fundamentals like population growth etc, as in the Perth property market whether I am still as optmistic about this market as before the boom times.

If population growth does not really take place in Adelaide in effect, then I guess it is a question of time that the house price in Adelaide must soon come down, now that the so-called Australia property boom is over and most the property speculators have exited the market for the shares investing.

The regional Australian property markets have its own boom times too over the last 2 years but many investors are now suffering from its price stagnancy or/and house price decline.

Will this similar trend actually apply to the Adelaide property market, only time will tell for sure!

Thank you


regards,
Kenneth KOH

 

[Merovingian]

Though you may in front presently but I wonder for how much longer in the Adelaide property market?

Please understand that as an overseas investor in the Australian property market, I am trying to do my own due diligence and to differentiate the truths about this particular market from the surrounding market noises and rumour-mongerings.

I guess it is better to be safe and well founded on the property fundamentals like population growth etc, as in the Perth property market whether I am still as optmistic about this market as before the boom times.

If population growth does not really take place in Adelaide in effect, then I guess it is a question of time that the house price in Adelaide must soon come down, now that the so-called Australia property boom is over and most the property speculators have exited the market for the shares investing.

The regional Australian property markets have its own boom times too over the last 2 years but many investors are now suffering from its price stagnancy or/and house price decline.

Will this similar trend actually apply to the Adelaide property market, only time will tell for sure!

I agree with the fundamentals here, Kenneth.

But, the talk of Adelaide not having population growth is a bit worrying. Adelaide does have a growing population, albeit not as much as most other Australian capital cities. There was an article in The Advertiser on Saturday regarding how much the population of Australia has increased in the last few years, and where it has increased. According to the article, all capital cities experienced growth in the last two years, with Brisbane, Perth, and Melbourne getting the most, for memory. I can't remember the article's source, or the numbers, but I think Adelaide is fairing "about flat", relative to Australia as a whole.

Of course, referring to capital cities as discrete entities can be a bit worrying, as there are markets within capital cities, and sub-markets, etc, etc.

Again, I still agree that it may be better, in general, to invest in areas that are experience a population influx, though there are opportunities everywhere.

My $0.02.

 

[Kennethkohsg]

Dear Merovingian,

"BIS Shrapnel predicted Brisbane, Perth and Darwin would be the only capitals to record price growth in the next three years. House prices were expected to fall in all other capitals." This is as per Anthony Klan's report in the Weekend Australian Newspapers dated 4th June 2005.

Thus, even BIS Sharpnel is projecting a fall in house price for the Adelaide property market over the next 3 years.

There was however no population growth figures mentioned for South Australia in the same report, unfortunately.

I wonder what the proponents for the Adelaide property market will say next.

Thank you.


regards,
Kenneth KOH

 

[Jamie]

Dear Merovingian,

"BIS Shrapnel predicted Brisbane, Perth and Darwin would be the only capitals to record price growth in the next three years. House prices were expected to fall in all other capitals." This is as per Anthony Klan's report in the Weekend Australian Newspapers dated 4th June 2005.

Thus, even BIS Sharpnel is projecting a fall in house price for the Adelaide property market over the next 3 years.

Hi Kenneth,

For the past few years, BIS Shrapnel have also predicted interest rates of up to 10.5% in late 2005/early 2006 - how successful does that prediction look now?

Predictions are what they are - nothing more than a guess. BIS Shrapnel have not had the best record in predicting housing movements in the past - I certainly wouldnt be basing my investment decisions on their predictions.

Predictions are also not suburb specific - when a forecaster says Sydney will have 0% growth next year, what does this actually mean? Every suburb will have 0% growth?

Of course not - some suburbs will fall, some will remain stagnant, and some will experience growth. As investors, its our job to make sure we invest in the properties that outperfom the average - while the average price movement for Sydney might be 0%, some houses/streets/suburbs will have 15% growth, some will have 10% growth, some will have 5% growth etc...

If you can find these properties/streets/suburbs, then what does it matter if the average property did not experience growth? Remember, you dont buy a median or an average - you buy an individual property

Jamie.

 

[Merovingian]

There was however no population growth figures mentioned for South Australia in the same report, unfortunately.

I wonder what the proponents for the Adelaide property market will say next.

Well I wouldn't consider myself a proponent of the Adelaide property market, or in fact any property market, but I would say that assuming Adelaide has flat population growth, different suburbs in Adelaide will see different trends, due to the continuing movement of a proportion of Adelaide's 1.2 million people.

But yes, investing in somewhere in Perth for instance, may make more sense long term, assuming equally good properties in either city.