Usually the term “a perfect storm” refers to a highly negative scenario.  One definition says a perfect storm is “an especially bad situation caused by a combination of unfavourable circumstances”.  I’d like to turn that around, because right now there’s a perfect storm of scenarios impacting real estate market and they’re overwhelmingly favourable for property investors and for real estate growth, while being extremely unfavourable for anyone looking for a place to rent.  Right now, real estate markets are being impacted by a well-entrenched imbalance between supply and demand – and it’s becoming increasingly pronounced.

Riding the Wave: The Perfect Storm for Property Investors and Real Estate Growth

Prepare to embark on an exciting journey into the realm of hot property markets with Terry Ryder and Tim Graham! Terry & Tim from Hotspotting, are dedicated to providing the most accurate and unbiased research to help investors make informed decisions on where to buy. The Hotspotting Podcast brings you the latest data, trends, and market statistics, along with in-depth discussions on growth areas and the larger factors impacting Australia's property landscape. 

Terry & Tim regularly feature special guests from around Australia to share their industry insights and expertise to help investors cut through the noise.

Whether you're a seasoned investor or a first-time buyer, this show is a must-listen for anyone looking to build their knowledge and make smarter investment choices. Terry Ryder, with over 35 years of experience as a specialist researcher and writer in residential property, offers expert insights that are completely independent and free from outside influences. Tim Graham has been a buyers agent and mortgage broker for over 13 years along with working in real estate all over the world.

Join us on the Hotspotting Podcast and discover the hottest opportunities in the Australian property market today!

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Catch the replay of our latest webinar hosted by Tim Graham, General Manager of Hotspotting, featuring Tyron Hyde, the visionary founder of Washington Brown and a master of property depreciation. Dive into the invaluable insights of "7 Lessons from the $26B Man," a presentation inspired by the legendary real estate mogul Harry Triguboff. In this compelling session, you'll explore the powerful strategies that fuelled Harry Triguboff's ascent to billionaire status, with a focus on the transformative impact of compounding in real estate investment. Discover practical advice and nuanced strategies that every property investor should consider: The Power of Compounding: Learn how small, consistent investments can grow over time and how to leverage this in the property market for significant returns. The 1% Rule: Uncover minor adjustments you can make that yield substantial improvements in investment outcomes. Whether it's negotiating a slightly better interest rate or enhancing property features to boost rental appeal, these small changes can dramatically increase your portfolio's value. Annual Reviews: Understand the importance of reviewing your home loan rate annually to ensure you're getting the best possible deal. We'll also discuss the benefits of cross-checking comparable rental prices to maximize your income. For more information on Washington Brown or to connect with Tyron Hyde, please visit www.washingtonbrown.com.au You can also subscribe to Tyron's Ten with Ty podcast here: https://www.washingtonbrown.com.au/podcasts/  

7 Lessons from the $26Bn Man - With Tyron Hyde

In this podcast episode, we dive into the two different approaches that state governments in Australia are taking to address the issue of rental shortage in the housing market. On one hand, Western Australia (WA) has adopted the carrot approach, offering incentives and encouragement to investors to increase the supply of rental properties. On the other hand, Victoria has decided to take the stick approach, punishing investors with new and higher taxes if they do not comply with the government's desires. The WA government has implemented several measures to encourage investors to bring new supply to the rental market. This includes offering cash incentives to property owners who convert their short-term rental properties, such as Airbnb, into long-term rentals for permanent tenants. They have also relaxed regulations around building granny flats, providing interest-free loans to help builders complete unfinished properties, and offering cash incentives to owners of vacant homes to make them available for long-term rent. In contrast, the Victorian government has scrapped the Victorian Home Buyer program, which was aimed at helping young people get into home ownership. They have instead turned to new and higher taxes on property investors to generate revenue and alleviate the state's debt. However, this approach may further exacerbate the rental shortage in Victoria. It is clear that the WA government's approach is more constructive and will bring new supply to the market, while the Victorian approach may have negative consequences. The WA government has also allocated significant funding towards social and affordable housing initiatives to not only increase supply but also support those in need. So, why are property investors now more likely to buy in Perth and key WA regional markets, while selling in Victoria? The difference lies in the government's actions – WA is encouraging investors, while Victoria is discouraging them. This highlights the importance of government policies and their impact on the housing market. In conclusion, governments have two options when it comes to creating significant change – the carrot approach or the stick approach. In this case, the WA government's carrot approach seems to be more effective in addressing the rental shortage issue, while the Victorian government's stick approach may have negative consequences. Time will tell which approach will yield better results, but it is clear that incentives and encouragement go a long way in creating change. 

Carrot or The Stick?

Leading the Way in Property Management: Corinne Bohan From Image Property

Australia has some outstanding markets which are performing on every metric, including price growth, rental growth, low vacancies and high yields. And many of these places on not what you might expect. Every quarter, Hotspotting publishes a report we call The Pulse, to identify 50 locations across Australia which deliver rental yields well above the average to investors. The primary parameter of our national Top 50 list is to identify good markets with high rental yields, but our criteria also includes prospects for capital gains – and this report features locations which perform outstandingly well on price growth. To provide an example of the possibilities, consider the regional town of Murray Bridge in South Australia. In Murray Bridge, house rents have risen 27% in the past year, with the vacancy rate dropping further in the latest quarter to just 0.4% and the median rental yield growing from 5.4% to 5.5%. The median house price has grown 22% to $415,000 in the past year. In Geraldton in WA, the median house price rose 11.6% to $355,000 in the past quarter, but the median rental yield remained well above average at 6.7%, following a 23% annual rise in house rents, with vacancies low at 0.8%. This report also highlights some of the nation’s promising unit markets, in recognition of the rising trend of more and more buyers opting for apartments and townhouses – and attached dwellings now out-performing on price growth. In Bowen Hills in inner-city Brisbane, the vacancy rate is 1.2% and the median unit rent has risen 15% in the past 12 months, with the median rental yield increasing from 6.2% to 6.6% in the past three months.  In that quarter, the median unit price has increased 7.1% from $425,000 to $455,000. There are many other examples of this kind of outstanding performance on both rents and capital gains – all identified in the new quarterly edition of The Pulse.

The Pulse Report Highlights

If investors had followed our tips, three months ago, in a special report we call The Pulse, they could have achieved double-digit capital growth - in the latest quarter alone - and up to 30% in the past year. The primary parameter of our national Top 50 list of locations in The Pulse is to identify good markets with high rental yields. But our criteria also includes prospects for capital gains – and this report features locations which perform outstandingly well on price growth. If you have an initial rental yield of 6% or 7% and your property’s value is growing 10% or 15% (or more) per year, you’re a happy investor. Several of the locations on our Top 50 list have recorded capital growth above 10% in the latest quarter alone, headed by the Perth suburb of Orelia which increased 18% in three months. All of the 50 locations on our Top 50 three months recorded capital growth over the latest quarter, except one – and most experienced median price growth above 5% in the quarter, including nine locations which rose more than 10% in three months. In the case of Orelia, this means $70,000 in capital growth in just three months, while the Perth suburb of Hillman also rose $70,000.  If you had bought a house at the median price in East Mackay, Queensland, your property’s value would have risen $50,000 in three months.  A $490,000 purchase in the southern Brisbane suburb of Kingston three months ago would now be worth $535,000, up $45,000 in the latest quarter. In annual growth terms, 11 of our suburbs have risen by more than 20% in the past year. This report demonstrates that it is possible to achieve an investment property that ticks every box for the owner: high capital growth and above-average rental yields in affordable locations with ultra-low vacancies and rent rising more than 10% per year. Among the most outstanding performers identified by this report are locations where property values have risen notably, but rental yields have increased because there has been an exceptional increase in rents. One of the stand-out markets highlighted by this report is the Queensland town of Dalby, the key regional centre for the Western Downs region west of Brisbane.  With vacancies near zero, rents have risen 24% in the past 12 months, with the median rental yield increasing from 6.6% to 7.2% in the past three months. Property values have also soared, with the median house price up 15% to $350,000. That is the kind of performance that is possible if you get the quarterly editions of the special report we call The Pulse.  

Riding the Wave: The Perfect Storm for Property Investors and Real Estate Growth

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