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The last couple of years have been crazy for investors – with the GFC, the stock market crash and the American property market plummeting.

Now some so-called ‘experts’ are getting on the bandwagon… saying a property bubble in Australia is about to burst – and comparing our real estate market to countries like Japan & the United States.

Nothing could be further from the truth!

I wasn’t going to run any FRΕE trainings this year. But I’m concerned about all the misinformation flying around and have decided the time has arrived to finally reveal the facts, and set things right for all my subscribers out there who are getting lost in all the media noise about the property market.

Watch this video now to get all the details:

http://investmentmentor.com.au/events/property-boom-strategies-to-prosper-in-todays-environment/

The news is blaring about how terrible the economy is, but has anyone shown you the facts…

• Have you seen what the ABS and BIS Shrapnel have to say about population growth?
• Do you know about our two-speed economy?
• Have any of the experts or newspaper editors backed up what they have to say with graphs & studies which can actually be proven?

Trying to sift the wheat from the chaff is tough. You can end up jumping from confusion to fear & back again – and those emotions can end up pulling you under.

But what if you had the undisputable facts that allowed you to COMPLETELY AVOID all the hearsay so you could get to the heart of what’s happening and make informed decisions about how to invest to secure a prosperous future.

Take control of your wealth building decisions today – these facts will change your game completely and stop you from making costly decisions you could later regret.

Get all the details here:

http://investmentmentor.com.au/events/property-boom-strategies-to-prosper-in-todays-environment/

Read more…

Population growth has been a bit of a political “football” in recent times but the fundamental pressures are beyond question.

Recent figures from the Australian Bureau of Statistics (ABS) reveal that population growth has slowed considerably from its peak level of 2.2 per cent in 2008, down to just 1.6 per cent for the year to September 2010. This is however close to our 25 year average, with 345,000 new residents for the latest year; primarily due to a slow down in the surge of net overseas migration that we witnessed in the past few years.

In a recent article in the Australian Property Investor magazine , Michael Yardney has commented that this lower level of population growth is likely to be short lived.

He is reported as saying – “The bottom line is that we’re an ageing population and in order to sustain our economy and support the millions of retirees and pensioners that will be flooding the health and welfare systems over the coming years, we simply have to ‘populate or perish’. Regardless of how hard our politicians push the political barrow and how much noise they make about slowing down immigration, the fact remains that we have to increase our skilled labour force. Then there’s the rising rate of natural population growth due to our increasing lifespan and birth rate, which is completely outside the government’s control. “

The aging population is an issue common to all countries to a greater or lesser extent. We are told that around 43 per cent of our workforce is made up of Baby Boomers, many of who are going to retire over the next 15 years, but lack sufficient savings or superannuation to see them through their senior years.

As they leave the workforce they’ll stop paying tax, many will go on the pension and most will use our public health care system, placing a massive burden on our economy.

As Michael Yardney says “Despite the rhetoric from both sides of parliament we have to significantly increase our population to replace the workforce, capture skills and grow the economy. The question then becomes: where do we house these essential new residents?”

Adding to the population issue a recent article in the Courier Mail said that thousands of Queenslanders were already on the waiting list for public housing.

The main points in the article were-

1. Almost 30,000 in Queensland were waiting for a roof over their heads.

2. Canberra has declared state-managed public housing “outdated” and financially unsustainable.

3. Federal Housing Minister Mark Arbib has called for private investment into the state housing market, labeling the present system unsustainable.

4. Mr Arbib has forecast a 28 per cent spike in demand for housing in the next decade.

Politicians can debate the population issue as much as they like but the demographic pressures will continue to grow.

Happy investing,

Martin Bell

Back around the time of the federal election I read a newspaper article that pointed out some interesting figures. Queensland Treasury and the Australian Bureau of Statistics revealed the under-supply of housing was spread across the state. Brisbane built nearly 2,000 fewer dwellings than needed last year, while in the north, Townsville and Cairns were down 1,000 and 800 respectively. Toowoomba’s housing shortfall was more than 450. So before you say “Not Another Housing Affordability Article”; keep reading.

The paper said “With demand exceeding supply, first-home buyers, already jittery following interest rate rises, have even less chance of entering the market.” This generally leads into the discussions of housing affordability with another article in the same paper headlining “Unaffordable housing is the great Australian nightmare” and saying “International standards recognise an affordable house as three times household median incomes, but in Brisbane and the Gold Coast, prices are more than seven times the average income.”

At the risk of boring people who have heard me drag this one out before…

Some years ago Marion and I went down to Sydney to see the War of The Worlds musical. While walking in the Homebush area we came across the Old Sydney Brick Pit and there I found a plaque saying that the average Sydney home cost £1,600 in 1911 when the brick pit was running and the average annual wage was £200.

So the average home cost 8 times the average annual wage (just as it does now in round figures). Not a lot of price change that I can see; however, I do see big change when it comes to peoples expectations in a house these days. Read more…

Looking a little closer into “Current Property Trends” will reveal one of two stories. If our opinions are formed by sensational media reports we are likely to draw a different conclusion than if  we take the time to understand the normal workings of real estate cycles. I trust that the following statistics around first home buyers and building approval numbers etc will assist your understanding of how current property trends can work in your favour.

2010 has seen the number of first home owners entering the market continue to trend down. This is to be expected given we have seen higher interest rates, higher home values and of course the end of the Federal Government’s boost to the first home owners grant.

Overall our strong economy and low unemployment levels should ensure that this slowdown will not be as dramatic as it otherwise would be.

Australian Bureau Of Statistics

According to the Australian Bureau of Statistics (ABS) borrowings by first home buyers:

• Averaged 115, 698 a year between July 1992 and July 2010
• Peaked in the 12 month period of November 2008 to November 2009 – 193,247 in total – 67% above the abovementioned eight year average!
• In the 12 month period of July 2009 to July 2010 totalled 129,842 – down 33% on peak but 12% up on annualised average.

Read more…

Prevention is better than cure!

Do you remember when the GST was introduced into Australia? It was July 2000. Since then, most working singles and couples could have managed to secure (at least) half a dozen well researched residential investment properties. If you did this; congratulations! No doubt, with falling interest rates and a seriously growing housing shortage… the global slowdown would be delivering you more benefits than challenges right now!

Reaction is all too common! Why wait for drastic times to push us to those “drastic measures” that the politicians keep spruiking?

Doesn’t it make more sense to conduct our financial affairs during the good times in preparation for those drastic times… that always find us sooner or later?

Now while we can’t change the past, it is unwise… perhaps irresponsible… not to learn from it!

Read more…

Do you love surprises? I don’t as a rule because they often come packaged up as problems!

The best thing we can do with a problem is rename it! It’s not a problem, it’s a “challenge”… and with every challenge comes an opportunity to grow!

“Those who remain flexible rarely get bent out of shape”!

When Katrina and I settled our last property purchase we were without a tenant for almost 4 weeks! Given the housing shortage, we were very surprised.

So why did it take that long for us to secure a tenant?

Read more…

It’s official. We now know what Australia’s best economic boffins think happened to the housing market in the first quarter of 2009 following a week of confusion (recall the ABS numbers conflicted with those of both APM and RP Data-Rismark).

In the RBA’s Statement on Monetary Policy released today, the RBA concluded (p33): “After falling modestly in 2008, nationwide housing prices were little changed in early 2009, although there is some variation in the range of available measures that use different techniques to control for changes in the composition of property transactions (Table 10).”

In Table 10, the RBA shows five different measures of house price changes in the March 2009 quarter.

Four of those measures – from APM, which uses a stratified median price index, and my company, RP Data-Rismark, which uses an hedonic regression technique – were positive or flat across Australia while one, the ABS’s stratified median price index (the one that the media has focused on), was down strongly.

The ABS’s index data does not sit well with the RBA’s conclusion that “nationwide housing prices were little changed in early 2009″.

>>> Business Spectator – The RBA’s view on house prices – Blog – Christopher Joye.

Australia is experiencing a population boom not seen since the 1960s – but it is not a baby boom.

High levels of immigration are fuelling record population growth.  

Australia’s headcount increased by almost 400,000 last year to 21.5 million, fresh data from the Australian Bureau of Statistics (ABS) shows. More than half of the new arrivals, or just over 230,000 people, were immigrants. The rest were babies born in Australia. The federal government this week moved to reduce immigration, cutting the skilled migrant intake by 14 per cent in response to the economic crisis.  

The rate at which the population is growing has surged 50 per cent over the last five years. It is now growing at just under two per cent a year. “The last time Australia experienced higher growth rates was in the 50s and 60s as a result of post war migration and high birth rates,” the ABS said in a statement.  

Western Australia and Queensland attracted the most new people in the year to September 2008. Tasmania was spurned.

For people moving within Australia, Queensland was the mecca, while people from NSW appeared keen to leave their state.

Cathy Alexander, Sydney Morning Herald

March 18, 2009

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).

Keep this philosophy in mind the next time you either hear, or are about to repeat a rumour.

In ancient Greece Socrates (469 – 399 BC) was widely lauded for his wisdom.  One day the great philosopher came upon an acquaintance who ran up to him excitedly and said, “Socrates, do you know what I just heard about Plato, one of your students?”

“Wait a moment,” Socrates replied.  “Before you tell me I’d like you to pass a little test.  It’s called the Triple Filter Test.”

Read more…