november-market-update

One of our great and long term Custodians 'called me out' after last month’s newsletter when I said I inspect my real estate once a year; she reminded me that I often say I haven’t even been to most of my houses.

In truth we were both right. She was correct when she says I haven't seen my houses and I was correct in saying I inspect my real estate.

What I revisit is the land where my houses are, and the land around them.

We see a lot of distorted facts published about affordability. The solution is simple: density. And it's coming!

In 5 years the standard block will shrink to 200-300m², maybe even less. 

I was in the US last month for the annual Urban Land Institute conference. We inspected 2 and 3-storey housing built on as little as 70m² lots... and many of them even detached!

Is this the direction our Australian housing market is heading in?

I will be featuring some of these LA homes in our Calculate, Motivate, Initiate webinar on 14, 15 & 18 November 2017 and also mentioning the next revolution in transport – “as big as the shift from horse and carriage to motor vehicle.” I suggest you enrol here.

This brings me to a couple of numbers that have some meaning to us…

Mortgage insurer QBE recently produced a report on housing that highlights the growth in 3 areas of a city: the inner, middle and outer.

Looking at last year’s numbers gives you a feel for the cycle when the outer areas are showing the highest growth. 

Table November market update  2017

We focus on the middle and outer city regions for 2 reasons:

1. You can buy more land for less money per m², which is vital for long-term growth.
2. Cash flow - it’s simple, you need both cash flow and growth to duplicate. 

The issue of affordability and the Census, to me, confirmed our model of land focus and location criteria as the sweet spot for the future.

What jumped out of the 2016 census is the effect of migration and baby boomers on our numbers in 2 ways: renters and growth. The next few years are going to see some major disruptions in the way we view a property’s rental ability – and who is going to live in them.

Jump on my final webinar for the year to learn about real estate innovation at its finest! I will also be discussing what’s impacting the world and how it will affect you and your investments as I touch base on my recent study trip to the Annual World ULI conference in LA. 

Finally, I will show you my secrets to staying motivated in the game of life, and kicking goals, personal, financial, and health related – year round.