CITYLIFE INVESTOR NEWS
July 24, 2009
In this issue: 1.
The 6 Golden Rules for Investment 2.
Investors Rate Australia Among Worlds Top Three 3
Homes Make Up Lost Ground 4
Home Loans Up 5.
Perth Makes Astounding Recovery 1.
The 6 "Golden Rules" for Australian Property Investment
Rule #1 "Never buy anything under 50 m2. Never buy 'student housing.' Never buy a 'serviced apartment.' "
Rule #2
"Don't sell too soon! Hold your investment for a full property cycle. If it was a good property when you bought it, it will be an even better property in 5 years. Allow time to maximize the benefits of leveraging, compounding and inflation." Rule #3 "Always buy the "lesser" property in the best location you can afford. Prime locations in Australia are the last to fall, and the first to recover in a downturn, and hold their value better." Rule #4
"Think what tenants what, not what you could live in yourself." Rule #5
"Always look for a 'point of difference.' It could be a different floor plan, a 1 bedroom in a block of 2 bedroom apartments, a great view, a never to be repeated location, or something else unique and not easily duplicated." Rule #6
"Ensure there can not be an oversupply in the near term in your preferred location."
There you have our 6 Golden Rules to help ensure investment success in Australia.
Ideally, your investment property should have all 6 of these in place! If your property has NONE of these in place, then we suggest you implement additional Rule #7:
If you have made a truly poor buying decision, and have bought something that is highly unlikely to move up in value for years to come (if at all) or is getting a very poor rent return, then we suggest ignoring Rule #2 above, and cut your losses and sell sooner rather than later.
2.
"The Australian": July 2009
As reported:
"Australia, China and Japan have topped the list of the best countries of property investment in an annual survey of investment intentions of the world's largest global real estate investors.
"The choice of Australia among the top three investment destinations was a sharp contrast to the findings in last year's inaugural survey when Australia was not even mentioned.
"Mr Robert Lie, AREA's the founder and director of Dutch property group Redevco told the Australian newspaper he was not surprised by this year's findings on Australia "as a lot of investors are regularly getting on a plane to Australia this year."
"This was not the case a year ago, until recently investors were looking for growth and opportunist investment in emerging markets , however, that this year's survey showed investors wanted returns from core assets in developed markets". he added.
The results of the survey were released during REIT world 2009 in Singapore, an annual event that attracted the top decision-makers in property from around the world.
3.
Homes Recover Lost Ground
As reported in the Financial Review Wednesday 1 July 2009," the median house price in Australia has recovered almost of all of last year's falls and is approaching a new high, the latest figures suggest.
"In December, house prices were down 3.9% from their peak, but RP Data's monthly figures for May show the median Australian National house price is only dollars 520 short of its February 2008 peak.
"In contrast of forecasts of weak house prices this year and the potential for double-digit losses, prices in every capital city other than Perth have risen since January.
RP Data head of research Tim Lawless said "in the five months to May 2 99, we can officially say the market has recovered.
Prices are on an equal footing to where they were before the downturn. Compare to the UK and US, it is a della performance and speaks volumes about the strength of the Australian economic fundamentals and financial sector.
RP Data's figures also show the median apartment price rose 45% nationally, while houses jumped 37% in the five months to May. From a year ago, houses rock 1% while apartments are bounced 3.32%.
Melbourne, Australia's best performing city at the time of last year's downturn, having achieved an annual growth of more than 20%, leads the country once again, with median house prices up 6.1% in the year to date, and apartments up 4.5%
4.
Housing Loans Up
The recovery is everywhere. Housing loans throughout Australia group solidly last month, boosted by the Federal government's stimulus package and lower interest rates. Figures released by the reserve bank of Australia show the strength in home lending was driven by a rise in loans to owner occupiers. Treasury also said that 20,000 people had received the first home buyers' grant in May.
New home sales were running at about 20% higher than from the same period last year.
Economists said the latest data combined with all the good news on house prices confirmed Australia would not experience a US style collapse in prices.
"these results put beyond doubt the fact that below call property market is not headed for the Armageddon scenario foreshadowed by some" an economist from Australia and New Zealand banking group, Alex Joiner said.
5.
Market Makes Astounding Comeback
The Perth property market has staged a strong comeback, with median house prices jumping $10,000 since December last year.
According to figures released by the Real Estate Institute of West Australia, sales volumes have returned to a 15 year average following the lull of late 2008
REIWA President Rob Druitt said WA's property market experienced its strongest turnover since September 2007, with the number of sales increasing by more than 40% since December. Copyright 2009 The Citylife Property Group. All rights reserved. ~~~~~~~~~~~~~~~~~~~~~~~~~~~ Own an investment property already? Need the best PROPERTY MANAGER? Here is Citylife's recommended Property Managers, Australia wide: www.citylifeproperty.com/pp_34.asp ------------------------------------------------------------------------------- Off plan properties for sale: www.citylifeproperties.com -------------------------------------------------------------------------------- Contact Us: If you have specific requirements, wish to ask any questions relating to your personal situation, or have any questions, email us direct at: info@citylifeproperty.com --------------------------------------------------------------------------------------------- This message and any attachments may be confidential and/or legally privileged. If you received this message in error, please do not copy or distribute it. To the extent that this email contains information for investors Citylife does not warrant that it is accurate or complete and no responsibility or liability is accepted for the consequences of any actions taken on the basis of this email. Information provided is of a general nature only, and investors should seek their own advice.
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