Hotspotting

The Greens attract a big enough share of votes to have an influence on federal politics because of people’s concerns about climate change and other environmental issues.

But they continue to distinguish themselves with economic policies that would be extraordinarily damaging if they were ever implemented, especially their policies on the housing market.

There is a growing body of research data showing that real estate markets are much stronger than we were told to expect in 2023.

Sales activity remains consistent or strong in many key markets, prices are rising in most of our capital cities and many of our regional markets, and vacancy rates remain ultra low. 

The key factor driving this resilience of property markets, regardless of all those interest rate rises, is (in a word) shortage.

There’s a shortage of everything that matters in real estate: a shortage of listings of properties for sale, a chronic shortage of properties available for rental and a shortage of new dwellings under construction.

This is putting upward pressure on prices – and that pressure is big enough to overcome the negative forces like higher interest rates, high inflation and negative media.

The most perplexing and frustrating thing about life in Australia is that despite our good
fortune, our wealth and our resources, we never seem able to find solutions to the problems
that afflict our nation.

Whether it’s aged care, the health system, climate change, youth crime, deaths in custody,
housing affordability or the rental shortage crisis, we never get to the end game – resolving
the problems by implementing viable solutions.

And here’s why.

It’s because all the energy and focus is directed to finding a scapegoat for the problem and
vilifying them in the media – not towards understanding

This is The Year Of Opportunity for property investors.
It presents the potential to buy well in locations with growth credentials, achieve good rental yields to offset higher interest rates and find rising income through rental increases amid historically-low vacancies.

On Wednesday 24 May property investment expert Jason Paetow described why switched-on investors are “buying the dip” – setting themselves up for future growth by investing in a climate of reduced competition from buyers, but growing competition among tenants for increasingly scarce rentals.

Paetow, the Managing Director of AllianceCorp, explained where the market currently sits and what it will look like as the year progresses.

He joined Hotspotting founder Terry Ryder in this free webinar event to discuss where to find the best opportunities in markets across Australia which offer affordability, higher yields and potential for capital growth.

Now more than ever before, the issue that drives the decision-making of most real estate consumers is affordability.

Over the past 12-18 months when some markets across Australia have been struggling, the ones that have remained buoyant have been the ones where home buyers and investors can find properties at attainable prices – with rising interest rates making this even more of an imperative.

It’s not a coincidence that the capital cities which have remained busy and competitive recently are the cheapest ones – Perth, Adelaide and Darwin.

Equally, the cities where markets have dropped the most through this period are the most expensive ones – Sydney, Canberra and Melbourne. Regional Australia – generally speaking – has performed better than capital city Australia because there are much more affordable options for buyers of all kinds outside of the big cities.

Very low vacancy rates have been the reality for most parts of Australia for years now.

And, as a consequence, we’ve seen major rent rises, causing financial hardness for more and more tenants – if they can find somewhere to rent at all. Until recently, media has reported the fact that there is a shortage of rental properties and that rents are rising fast – but there has been no analysis about why we are in this difficult situation.

Now, at last, media is starting to write about the circumstances that have led us to a national rental shortage crisis – specifically, the series of political actions which have deterred investors from buying properties and making them available for rent – or prompting investors to sell up and exit the property investment market.

For anyone who cares about the big issues afflicting housing markets, the Federal Budget delivered on 9 May was a monumental disappointment. Many Australians – including myself – believe that the biggest issue confronting the most people in this country is the COST OF SHELTER.

The big issue is the cost of buying homes and the cost of renting homes – with one key word describing the essence of the problem: SHORTAGE.

We have a shortage of everything that matters in our housing markets:- * A shortage of listing of homes for sale

• A chronic shortage of homes for rent
• A shortage of construction of new dwellings 
• A shortage of the materials and tradespeople needed to build new homes 
• A shortage of affordable options for people early in the property life cycle.

And there was nothing – NOTHING – in this Federal Budget which addressed the underlying causes of these endemic problems.

Some green shoots of recovery have appeared in the Regional NSW market after a year in which the market steadily declined in many locations.

While locations classified as rising markets continue to be scarce, there are significant numbers of locations which have maintained consistent sales activity through the downturn period – and meaningful numbers of locations which have recently reversed the previous decline in their sales activity.

At the same time, there remain a number of locations which have been in decline for the past year or longer.

And plateau markets, those where sales activity has tapered off and settled at levels below the previous peaks, continue to be the biggest cohort in the Regional NSW market.

If you bought a property for $450,000 a year ago and, despite media rhetoric about prices falling everywhere, it was worth $570,000 today, you would be happy, right?

If you made $120,000 in capital gains on a $450,000 outlay, amid the so-called national market downturn of the past 12 months, you would feel satisfied with your decision-making.

How about if you’d bought a property for $620,000 a year ago and it had grown to be worth $755,000 today, regardless of interest rate rises and constantly negative media?

You would be happy with a capital gain of $135,000.

That’s the power of the Best Buys report by Hotspotting.

Have you ever wondered how the members of the Reserve Bank board can so nonchalantly
inflict the pain of constant interest rate rises on the families of Australia?

Here’s why. The members of the board which make these decisions don’t feel the pain of
their decisions.

They’re all multi-millionaires – high-flying corporate executives, academics or economists
with massive incomes which separate them from the pain of mortgage payments.