Michael Bentley

This E-Booklet contains vital and exclusive information for foreign investors
looking to increase (or purchase their first) Australian property.

But with the Banking sector and financial markets in turmoil, people have been
asking, what will happen to Australian property?

The flight to quality is on, as people liquidate out of the money markets.
Trillions and trillions of dollars have “moved” into cash.

At some stage, this cash will look for a home.

After the World Stock market crash of October 1987, when the Dow Jones and
Australian all ordinaries plummeted, WHY did Australian property prices surge
in the 2 to 3 years immediately following the stock crash?

First, cash needs a home. Many people who have been panicked, and burnt,
will feel very reluctant to reinvest in similar financial instruments, and stock
markets again. At least in the short term.

As the flight to safety continues, many people who chased high returns move
back to investment fundamentals and for many people that means property.
After the stock markets crashed in October 1987, billions of $ moved into
real estate.

Secondly, the Australian economy remains fairly strong.

Thirdly, there is a chronic shortage of construction and new houses being
built all around Australia. THIS IS CRITICAL, and is little understood by most
people. They may have “heard” about it, but have not given a minute's thought
about how they may be able benefit from out of this situation.

In the USA for example, there are reports that literally millions of homes have
been oversupplied.

Australia simply doesn't have suburbs full of empty houses awaiting mortgagee
sales. Instead we are not building enough houses. Not nearly enough.

From a supply and demand perspective America was and is over-built - there
are just way too many houses. In Australia it's the exact opposite - we are
not building enough houses and now our occupancy rates for rental properties
have climbed to record highs.

Fourth, we have huge and continuing migration to Australia. In calendar year
2007, over 410,000 people migrated to Australia. In 2008 it is expected that
the figure when announced will be similar.

But where will all these people live?

When you have the biggest population growth in decades happening at the
same time as the largest shortage of homes being built in decades, something
big will happen.

Putting all this together means that we are currently starting to see rental
increases, and if you already own Australian property, then 2009 will be a great
year to be a Landlord.

This will continue for some time, maybe even for years to come.
So, is 2009 actually a good time to invest with the financial turmoil?
History is full of times when people said “now is not a good time.” Yet in many
cases, they were proven wrong.

Again, what is known already is that hundreds of new apartment and
townhouse projects have already been shelved, as Developers have struggled
with either a lack of confidence, or in most cases getting mezzanine and
construction finance.

This is an example of how investors will directly benefit from the financial
crisis, as fewer projects mean less supply.

If you can secure a prime property today on just 10% initial deposit, at a
reasonable price, in a prime rental location, that would have to seem to be a
good real estate play for the future.

The kicker for investors could be if we see the return of inflation.
And who would bet against prices not being substantially higher in 4 years
than today?

Please enjoy the articles in the E-book, and happy and prosperous investing in
2009 and beyond!

Michael Bentley

Managing Director
The Citylife Group.
April 2009

(From the E- Book, The Foreign Investors Complete Guide to Buying and Profiting from Australian Real Estate" published in 2009 Click here to read more)