I read recently that In the last few months leading to investors to buy existing real has shot up 10 % . I think the main signal the property is starting to recover is increasing numbers of investors getting into the market. This is for a number of fundmental reasons:
- Often expirienced investors know when the markets have hit the bottom and know when to time their entry into the market.
- Expirience investors are quicker to relises that all prices are relative. For example a mum and dad investor might look at the average price in a suburb for a house and think gee thats expensive because 4 years ago it was 1/3 cheaper. However a more expirienced investor will know that prices dont stay stagnant and what was expensive then when it peaked is now cheaper due to the relative growth it will have in the future. Dont belive this , think about it , how many times have you heard people talk about or how many times have you though about how much cheaper houses were 10 - 15 years ago. Now they looked cheaper but back them im guessing you didnt think the same thing then, chances are your attitude hasnt really changed. Although admidantly housing prices in Aust capital cities are at an all time high proportinant to our incomes. But you get the point.
- Expirienced investors often have the comfort zone and are willing to jump into an unfavoured asset class.