mrd

I think it’s fair to say our world economy has caught somewhat of a Virus. In true mrd style, here’s a brief description of the many forms of economic viruses affecting the markets… and while you’re at it why don’t you make up your own virus in the comments section.

Read more…

March 18, 2009

Australia experiences high population growth: Australian Bureau of Statistics (ABS)

Australia is continuing to record high population growth, according to figures released today by the ABS.

A total population growth rate of 1.8% was recorded for the year ending September 2008, up from the 1.2% recorded five years ago. The last time Australia experienced higher growth rates was in the 50′s and 60′s (above 2%) as a result of post war migration and high birth rates.

As at 30 September 2008, Australia’s population had grown to 21,542,000 an increase of 389,000 people over the previous year. Australia’s net overseas migration contributed to more than half of this growth at 61% or 235,900 people. Natural increase (the excess of births over deaths) contributed 153,400 (39%).

In the same period, Western Australia continues to record the fastest population growth at 2.9%, followed by Queensland (2.5%), the Northern Territory (2.2%), Victoria (1.8%), the Australian Capital Territory (1.4%), New South Wales (1.3%), South Australia (1.1%) and Tasmania (0.9%).

Queensland and Western Australia received the most people from net interstate migration, gaining 22,700 and 5,600 people respectively from the other states and territories. The states that lost the most people to interstate migration include New South Wales (down 22,400), South Australia (down 4,700) and Victoria (down 2,400).

The Gold Coast Sun newspaper ran an article quoting property analyst and author of the Midwood report, Bill Morris, as saying he expects an average increase of 30% on Gold Coast housing by the end of next year. He said that historical data confirms the cyclical nature of the property market and its ability to bounce back.

I quote “Over the past 40 years we (on the Gold Coast) have had a regular seven year cycle regardless of interest rates and the state of the economy.” He commented that in the last boom of 2003 some prices increased by 100% in one year and he expects a recovery early next year with prices increasing by up to 30% on current values.

I often have dinner with Bill Morris at a local golf club ( a fun trivia night) and I was interested to hear that two of the areas he is forecasting huge growth in are ones where I own property. The main negative thought Bill passed on was regarding holiday let (often high rise) apartments as “they are discretionary purchases” often bought as holiday homes and are off loaded quickly when the economy turns sour.

Martin Bell

A blonde and brunette were watching the 6 o’clock news.

The news was about a man about ready to jump off a bridge.

The brunette turns to the blonde and says, “I bet you $50 the man is going to jump.”

The blonde replies, “Okay you’re on.”

Sure enough, the man jumps, and the blonde gives the brunette $50.

The brunette says, “I can’t accept this money. I watched the 5 o’clock news and saw the man jump then.”

Read more…

What Or Where?

I am repeatedly asked: “Am I Better Off Investing In Houses Or Units? “Personally, I tend to invest in units (apartments), rather than houses because I am more interested in where I invest rather than what I invest in.

Did you just pick up that the real question is “where” not “what”?

Readers of Nick’s weekly newsletter would know that we place huge importance on the laws of supply and demand. Whether oil, bananas (remember Cyclone Larry in 2007 and what that did to the price of bananas?), property or anything else, supply and demand will ultimately determine all long term pricing (NB: There may be short term “blips” along the way).

Read more…

From time to time clients ask us to recommend an accountant to them. We have had two such requests from Perth clients in the last 10 days or so.

If your accountant invests in property and encourages his or her clients to do likewise… and if you are happy with his/her accounting services, we would like you to pass their details onto us please.

Thanks for your recommendations; much appreciated more…

Happy Investing,

Nick Lockhart
mrd Customer Care Program… because investing is personal

A community hub for Robina is on the agenda for the Gold Coast City Council budget talks according to the Gold Coast Sun Newspaper.

The Gold Coast City Council will contribute $5.4 million to the project as part of its $100 million infrastructure stimulus package. The council believes that the rapid growth of Robina’s population has led to a shortage of available space. The new building, the first of its kind on the Gold Coast, will be constructed near the current Robina Community Centre and will also include more commercial office space.

So many things, but here are four clear positive differences:

• We’re not in the business of selling properties.  Property is simply the vehicle we use to help our clients increase their personal wealth.
• We believe in sharing valuable insight, enabling people to make their own, informed decisions, even if they decide not to buy through mrd.
• We select specific developments which have the best potential to maximise rental return and capital growth.  We turn down many, many more developments than we include on our stocklist.
• We put our own money into the investments we recommend.

If you have equity in your own home, you can use this instead of cash, as a temporary deposit.  As the value of your investment increases, the need for your other equity is diminished.

With the family home, there is generally only one person who pays the bills and that’s you!  However, an investment property is different because the tenant and the taxman pay most (and eventually all) of your bills; including interest and insurances.  Your contribution is made only after they have contributed their share.

If you are in the higher tax brackets, you may be surprised to learn that your contribution could in fact be nil.  As your mentor, I can show you how to manage any cash-flow shortfall so that it has no impact on your current disposable income.
Isn’t debt a bad thing?