Hotspotting

Most wannabe investors are herd animals, who dive into markets when they hear there’s a boom happening.

But successful investors seek opportunities when markets are off the boil.

They get busy when the markets aren’t moving, interest rates are rising, media is negative and most punters are sitting on the sidelines.

That’s when there’s less competition in the market and skilled investors can find the best opportunities for value-adding investments.

Those investors know how to make money irrespective of what the market is doing.

On Wednesday 10 May, Hotspotting founder Terry Ryder was joined by  Brad Cassidy of The Kaizen Way, who specialises in helping people find profitable property deals regardless of the economic climate or the real estate cycle.

Cassidy says educated investors know how to find properties that allow them to accelerate growth and create wealth through adding value.

On 10 May he will share his business models for finding the best property deals with opportunities to create your own growth, without relying on the market to do it.

Cassidy says: “We love it when the media is negative about property and most people are sitting on the sidelines. That’s the best time to use our strategies.”

There’s growing evidence of a trend in Australia’s biggest cities of rising demand for apartments, both for reasons of affordability and reasons of lifestyle.

In the most expensive capital cities, more people are opting for apartments in suburbs where houses are too pricey, but apartments cost less than half the price of houses.

We’re seeing it in inner-city and middle-ring suburbs in Sydney, as well as Melbourne and Brisbane.

In some of these locations, typical houses may cost $2 million but mainstream apartments in the same suburbs are available in the $700,000s or $800,000s.

This trend has been particularly noticeable in Sydney in areas such as the Inner West local government area or in the Canterbury-Bankstown LGA.

Get the new Top 5 Sydney Hotspots report which will give you a detailed analysis of the Sydney markets that have the best prospects for growth through 2023 and beyond - both for houses and the more affordable apartment market.

Week by week, more data emerges which confirms the general recovery in Sydney prices.

We’ve seen sales activity increase in some of the Sydney markets, auction clearance rates improve, rents continue to grow and prices show increasing signs of returning to growth.

Are we surprised? No, this is what we forecast, particularly after analysing the sales activity figures for the December 2022 Quarter, which showed improvement in key sections of the Greater Sydney market.

Discover which areas are leading the recovery with strong potential for further growth this year.
https://www.hotspotting.com.au/product/top-5-sydney/

Consumers trying to make decisions about WHETHER to buy or sell, or WHERE to sell or buy, need information that provides a clue to price movements in the future.

Knowing what happened to prices last month or last year doesn’t necessarily assist, because often THE PAST DOES NOT INFORM THE FUTURE.

This Exodus to Affordable Lifestyle is the internal migration of people from the big cities to smaller cities or to regional areas, propelled by technology which gives people the ability to work remotely – and therefore leave the big, expensive, congested cities and access a more affordable and more relaxed lifestyle elsewhere in Australia.

In December 2022 we wrote: “Our view at Hotspotting is that most markets across Australia will deliver some level of price growth in 2023. There will be regional differences, as is usually the case in real estate, but the general trend will be solid increases in prices.” The emerging data from PropTrack, SQM Research, Domain and CoreLogic confirms our views, with the price data in the first three months of the year turning increasingly positive.

Evidence of real estate revival in many of the previously struggling city markets continues to mount.

 The CoreLogic figures published earlier in April showed significant improvement in a number of the capital cities of Australia, led by a big increase in Sydney house prices.

The latest figures from SQM Research, published on April 18, provide further evidence of the return to price growth in cities that were previously lagging behind better performers like Perth and Adelaide.

The SQM figures for the past month show a 1.4% rise in house prices, as the average result across the eight capital cities.

One of the recurring themes in news media about real estate affordability is the claim that today’s young buyers have it a lot harder than their parents did when they were buying their first home, perhaps a quarter of a century ago.

But, like so many things espoused in mainstream media about residential property, it really isn’t true – not when you look fully at all the factors in play and crunch the numbers.

Recent research - which used data from the Australian Bureau of Statistics and the Reserve Bank of Australia - found that Millennials actually have it easier than did Baby Boomers, when it comes to the portion of weekly income spent on the monthly mortgage.

And, as one of those Baby Boomers buying my first property back in the late 1980s, I can testify to how hard it was – primarily because interest rates were so incredibly high and there were considerably fewer loan options.

And that really is the crucial difference.

Consumer confidence, that rather intangible but nevertheless important component of the property market, is showing signs of serious improvement.

And the area in which consumer sentiment has improved the most is with the outlook for property prices.

It’s the latest in a series of indicators showing evidence of recovery in the major markets which have been struggling since the beginning of last year.

The Westpac-Melbourne Institute Consumer Confidence Index lifted 9.4% in April, with confidence across mortgage holders growing by even more, at 12.2%.

Prospects for markets across Greater Melbourne will improve as 2023 progresses.

The key factor that will drive a return to higher market activity and prices is the impact of migrants and overseas students.

And this will build on the recovery which is already under way.

International borders re-opened in 2022 and this has led to an influx of overseas migrants and students, with Melbourne a key destination for those coming to Australia.

But it takes time for this to translate into major impact on property market activity.

The first impact is on the rental market, with overseas students helping to create a sharp decrease in the vacancy rate for Melbourne.