mrd

This video is now compatible with iPhones & iPads

Nick’s article two weeks ago – “The Property Investor’s Tipping Point” inspired a contribution from Martin Bell last week. Now it’s my turn! I’ve called my “final chapter in this trilogy”- “The Problem With Investing In Property”; let me first lay the important foundational knowledge.

More logic and less emotion would simplify things – as well as make life boring! Emotions are good (mostly), but not when investing!

It never ceases to amaze me that so many buy when others buy and sell when others sell. Logic isn’t the driver of such behaviour; rather emotion – and it produces poor outcomes.

Instinctively we know it’s more profitable to invest counter cyclically – sell when there’s an abundance of buyers and buy when there’s an abundance of stock for sale. For the record we really believe you’re better off not selling at all – but harvesting equity at the appropriate times.

The reason the current climate is referred to as a buyer’s market is because it’s the best time for people to invest – when opportunities abound!

A lot of effort has gone into writing this. I really want to help you to understand cycles and the problems with investing in property. I would really appreciate you submitting your comments and providing feedback at the bottom of this article.

Emotional Investing

“Why is it that consumers flock to the Boxing Day sales in pursuit of a bargain yet remain suspicious in a property buyer’s market – isn’t this irrational?” What’s even weirder is that the very same people who sit out during a buyer’s market are the ones who return to the market to purchase once prices have risen again – where’s the logic in that?

Most astute investors will tell you to “buy low” and “sell high”; just like those trading the stock market. The mrd philosophy is to not sell high, rather “refinance high” (ask us to explain if necessary).

Driven by fear, greed and/or a herd mentality (i.e. emotions) the majority of investors do just the opposite.

Let me explain how market cycles work to give you the knowledge to confidently buck the trend and start prospering – really!

This first graph is typical of the movements of the property market oscillating from oversupply to over demand.

While the length of the cycles expand and contract, the market will continue to move in a similar pattern. Read more…

Take advantage of a quiet market!

Jacaranda developer slashes up to $89,000 from these beautiful homes.

Quality 221m2, three bedroom home with media room, double garage, views of the city skyline in gated estate

Nestled into the foothills on the edge of Mudgeeraba, Jacaranda affords a rare opportunity to embrace a lifestyle that offers a unique blend of outer suburban serenity, with all the convenience and infra-structure of the city, right on your doorstep.  Set in an 8.5 har gated sanctuary, Jacaranda comprises 66 spacious villas, which occupy less than a quarter of the total development site. Read more…

Monday, 21 February 2011

By: Staff Reporter

After a slow start to the year, BIS Shrapnel is predicting the property market will pick up speed in the second half of 2011.

According to the forecaster’s Building Industry Prospects report released today, the total number of new dwelling approvals is expected to rise eight per cent to 177,000 in 2011/12 – the highest level since 2003/04.

“The increase in first home buyer demand from the Federal Government’s First Home Owner’s Grant Boost Scheme, together with various State Government incentives for new dwellings, resulted in new house approvals rising by 22 per cent in 2009/10,” Angie Zigomanis, BIS Shrapnel senior manager, building and construction said.

“However, these incentives only served to pull forward existing demand, with first home buyers who would have otherwise been in the market in 2010 entering the market in 2009 to take advantage of the increased incentives before they expired. As a result, there was a drop off in first home buyers in 2010, which has been evident by the decline in new house approvals through the second half of last year.”

via Property market to pick up in 2011 « Smart Property Investment.

THE outlook for Cairns’ construction industry has worsened as building approvals for new houses and units in the city fell to their lowest rate in a decade. Only 33 new houses and four new units were approved in October, dragging the city’s building approval rate to the same levels of the construction crisis that followed the introduction of the GST in 2000.

But building industry bodies in the region are looking towards the light at the end of the economic downturn, insisting the sector’s fortunes are overdue for an upswing. “The indicators are showing that we may still bounce along the bottom of the market for some time before we see improving trend lines in building approvals,” Housing Industry Association Cairns manager Peter Collins said. “But we believe there’s light at the end of the tunnel and we’d expect to see it in the second half of 2011 when there’s some return of confidence as well as pentup demand and population growth.”

Master Builders Far Northern regional manager Ron Bannah said population growth was likely to trigger a housing shortage in the region unless action was taken soon. “Demand is going to outstrip supply unless somebody starts building units soon.” But the Urban Development Institute of Australia says barriers such as red tape are preventing some developers from breaking ground on new projects. “Infrastructure projects are seen as being so beneficial to our community, and yet we’re subjected to such a bureaucratic process,” UDIA Far Northern president Adam Gowlett said. Mr Gowlett hopes a construction industry forum led by the State Government in February will reduce the bureaucratic burden of seeking building approvals.

Via Cairns Post Dec 2nd 2010

Perhaps you have heard the political bantering about NRAS and have wondered “What Is NRAS?” More likely you have no idea and think “who cares?”. Not reading this article to the end could be a very costly mistake, because I am about to explain a government grant that you probably qualify for!

Put simply, NRAS is a Federal Government Grant offered as an incentive to property investors to provide affordable housing to low and middle income earners.

NRAS, which stands for the “National Rental Affordability Scheme”, was dismissed by mrd when first released for a variety of reasons.

• The government ‘forgot’ to ask the banks if they’d fund it… and they wouldn’t. Doh!
• The scheme was way too restrictive and properties in the scheme had to remain in the scheme (even if on sold); threatening the future value of the property if there were no buyers around wanting to be restricted to keeping it in the scheme.
• There was much red tape but this has since been simplified.
• The new scheme was not communicated/sold very well and overall the take up was pretty poor.

NRAS Has Changed

One of the many criteria we use when researching property is “would I buy it”? Before the changes to NRAS the answer was a resounding NO!

Significant improvements to the scheme – and the banks new found willingness to back it – means we believe (the changed) NRAS provides a phenomenal opportunity for the right investor and would personally be happy to invest in an NRAS approved property as well.

NRAS In A Nutshell Read more…

After reading Nick’s article last week titled “The Property Investor’s Tipping Point” and then being offered this week a one off “Limited Opportunity For 3 Bedrooms At Robina For $429,000″, I was inspired to write a follow up to what Nick was saying.

Many of you will know that, as an investment, I personally like the area around Robina Town Centre. I own three properties in the immediate area, living in one and can confirm that the infrastructure spending here has been nothing short of massive.

As a hangover from the global financial crisis (GFC) the local property market has been quiet of late. Given there is virtually nothing new being built (limiting future supply) and the area is still attracting new businesses and new residents all the time I wholeheartedly believe we will witness this “quiet time” change in the next 6-12 months (I don’t of course claim to have a crystal ball but I have my own money “where my mouth is”).

Even with a quiet local economy the new $300mil Robina hospital extensions are nearing completion and the $36 million Robina Health Precinct located at Campus Crescent will be the first of its kind on the Gold Coast.

NB: All images can be enlarged by clicking on them

Myer recently opened their new $95 mil store just 12 months after $350 mil was spent revamping the town centre. This shopping “city” has all the majors now: Read more…

On Saturday 12th March 2011, at Karrinyup Shopping Centre (in Western Australia) the Variety Club Youth Choir organized a FLASH MOB where they all were incognito in the Food Hall, and started standing up in groups singing “We Are Australians”.

The purpose was to raise money for the QLD floods. Each time anyone clicks on one of the adverts on the page money is raised thru Google AdSense.

Please watch the video and click on a link to support those that suffered. You’ll also feel a pride for our youth and for being an Aussie!

Enjoy…

http://www.youtube.com/storytellermedia

Pass this on to others. Read more…

The potential for future capital growth is the number one incentive for Queensland property investors, according to the Real Estate Institute of Queensland (REIQ).

The institute conducted buyer and seller research last year and found 74 per cent of investors were buying property for capital gains purposes.

The next most common reasons were to fund retirement, for negative gearing purposes, as a means of deriving an income stream, or because they believed it offered a better long-term return than shares or super.

“While Queensland has had a very tough start to 2011, it’s heartening that many investors recognise the strength of our property market and the opportunities that remain for growth over the long-term,” REIQ managing director Dan Molloy says.

REIQ says 13 per cent of buyers purchased property last year for investment purposes. This is vastly different to 2003, when the proportion of investors was 40 per cent.

“Investors have most stayed on the sidelines over the past 18 months, but there are tentative signs they’re re-entering the market,” Molloy says.

“With stable rents, increasing demand and less pressure on property prices, there are plenty of opportunities currently available for investors to enter the market.”

via Australian Property Investor :: Capital growth pushes Queensland investors to snap up property.