Summary of the latest market forecasts from Australia’s most respected property economists
– BIS Shrapnel, by Richard Sheppard
The verdict is in from respected property forecaster BIS Shrapnel and, in the wake of the recent Sydney boom, some new targets are emerging for investors. The company’s latest three-year forecast highlights the residential property markets in Brisbane, Hobart, Canberra and Newcastle as growth centres. Add the booming Sydney office market and you have a blueprint for some very strong investment opportunity.
Why believe BIS Shrapnel? The fact that they are trusted by QBE, Australia’s largest mortgage insurer demonstrates their credentials, especially considering QBE has more at risk in the Australian property market than any other Australian lender or company as they insure billions of home and investment loans.
Go for growth
The best prospects for house price growth, according to BIS Shrapnel’s Residential Property Prospects 2016-2019 report, are Newcastle, Canberra, Hobart, and Brisbane mostly due to an underlying lack of detached houses and substantially better affordability than Sydney, with median prices in these cities predicted to rise about 7 to 12 percent by June 2019.
While this forecast seems modest, BIS Shrapnel is so conservative, the actual growth is usually much higher, so with interest rates tipped to stay low for years to come, the likely growth should make the investment very worthwhile.
Rounding out the target list, an earlier report from BIS Shrapnel predicts that Sydney office rents will rise 90 percent between now and the end of 2018 as demand for commercial space outstrips supply. This offers the prospect of phenomenal returns for investors, keeping in mind commercial property typically carries more risk than residential so advice is highly recommended before entertaining investment here.
Do your homework
Remember that the latest research takes a three-year outlook and many investors are seeking to hold onto the property for longer than a few years, so it’s wise to factor in longer-term considerations when purchasing a property. With a view stretching five to ten years, confidence is high that Brisbane property will growth three to five times better than Sydney over this period as Sydney is clearly very near the top of its growth and affordability cycle.
With the backing of quality research and advice, it makes sense for investors to use their equity in existing properties to buy other property and maximise their wealth. Speak with a specialist investment broker who can assess your borrowing capacity and revalue your properties at least every 12 months so you know your true equity position.
Signing up to a reputable property investment seminar can also teach you to maximise opportunities to grow your wealth.
Taking such a smart approach could change your life.
This article was originally written for Peninsula Living Magazine by Richard Sheppard.