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RENTS have recorded their highest increase since 1988 amid fears the rental crisis will only get worse as the impact of the global recession takes hold.

Latest figures from the Australian Bureau of Statistics show the annual rate of growth in rents across the country has jumped to 8.4 per cent in the year to last month, up 2 per cent from 2007. The statistics also reveal the increase in rents has jumped from 5.4 per cent to 8 per cent in Sydney, 11.2 per cent to 12.2 per cent in Perth and 8.6 per cent to 10.1 per cent in Brisbane. Adelaide also recorded an increase in residential rental growth of 4.7 per cent to 5.4 per cent and Melbourne jumped to 6.6 per cent from 5.4 per cent.

BIS Shrapnel senior economist Jason Anderson said the rental market was only going to get worse as the country’s economy faced a possible recession. He said the roots of the rental crisis before the economic downturn were the significant increase in immigration and high interest rates that left a shortage of about 100,000 houses.

But falling interest rates were yet to have an impact on the rental shortage because construction of much-needed properties had decreased because of worsening economic conditions and higher unemployment. “This means the shortages are going to get worse over the next two years,” Mr Anderson said.

From: The Australian January 29, 2009

VISITORS and overseas businesses will soon be able to buy residential property more easily in Australia thanks to a lifting of restrictions.

The Federal Government has relaxed rules over foreign investment and it should benefit more than 7500 overseas buyers.

Market flexibility will be enhanced, while compliance costs for temporary residents and the construction industry will be reduced, Assistant Treasurer Chris Bowen said.

The definition of temporary residents will also be aligned with contemporary visa categories.

Under the present structure, all temporary residents and non-residents, including foreign businesses, must notify the Federal Government if they wish to buy a property.

They must also comply with post-purchase conditions, including rules surrounding its use, development and resale.

Residential real estate makes up more than 92 per cent of applications received by the Foreign Investment Review Board.

The changes, to be implemented early 2009, will update regulations that are almost two decades old.

>>> Buying Australian property to be made easier for foreigners | The Courier-Mail.

To make sense of the property market we must separate opinion from fact. Opinions will always be heard… just in greater numbers now perhaps. If you are prepared to “drill deeper” and dissect the evidence available; the facts will speak for themselves. There’s no reason for allowing the conflicting voices of opinion to keep you confused!

In the current round of Web Seminars we are offering, I highlight four key factors that are a MUST… if you expect to draw any credible conclusions.

1.    Record Population Growth
2.    Investors Have Fled The Market
3.    Home Ownership Unattractive
4.    New Construction Has Stalled Badly

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City Park Construction is nearing completion anticipated for 30 November 2008 with settlements being between the end of January 09 and end of February 09.  This is subject to weather conditions allowing external landscaping completion and the progress of titles issue.

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It is not long now until the completion of this exciting project.  (See below for completion estimations)  This has been a long awaited project that we have all looked forward to.  We will continue to keep you informed of when construction is complete and the next step in the process for you.

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Cairns is the major city for Far North Queensland region situated on a natural harbor with a backdrop of rugged mountains and tropical rainforests. The state capital Brisbane is approximately 1800 kilometers by road and 2 hours flying time away. Cairns International Airport (link) is 7.5 hours from Tokyo and 6.5 hours from Singapore.

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An article in The Australian commented today that a third of the nation’s population lives in rural and regional centres, and that they felt the economic strength of the sector has been overlooked in recent times.
Colliers International national research director Rory McLeod was quoted as saying. “many regional property markets were showing strong growth — in commercial and residential property — and offered some good investment opportunities.” They also stated that Queensland residential property prices were still growing strongly and there was also an upward trend in non-residential construction and investment in regional areas.

Mr Mcleod said “The boom delivered first-round benefits in economic, employment and population growth, as well as second-round benefits as a result of the Government investing in infrastructure such as hospitals, airports, dams and ports, which benefit local communities”.

“Many of our regional centres are quite robust”, Mr McLeod told a recent series of Colliers seminars, titled Beyond the CBDs. “Most have a fairly diverse economic base and represent safe, solid, secure and attractive investment opportunities.”

Reportedly Townsville was showing the fastest growth in taxpayers, and Cairns had the highest growth in individual income with both cities showing the highest population growth in the areas surveyed. Mr McLeod was quoted as saying that house price growth had been flat in NSW since 2004, but prices in Queensland had continued to grow, particularly in the far north centres of Cairns and Townsville. “In Townsville, major projects are occurring in the defence, education, marine and healthcare markets.”

With the collapse of Lehman Brothers and the bargain basement sale of Merrill Lynch in the US, many economic commentators are predicting a second official rate cut next month in an attempt by the RBA to ease domestic financial conditions. Highlighting this renewed confidence, trades on the Sydney Futures Exchange indicate a 100% likelihood that rates will fall by 25 basis points on October 8th.

In all likelihood we will see higher levels of confidence return to the property market on the back of rate falls and demonstrated domestic stability. The most recent consumer sentiment figures released by Westpac and the Melbourne Institute have risen considerably during August and September, providing further evidence that market conditions are likely to improve.

With fewer buyers in the market, ABS statistics are highlighting a reluctance by developers to initiate the building of new housing projects. This may be good news for sellers, as the lack of new stock helps to underpin existing market listings with a floor price. Investors should also benefit as population growth and a general housing shortage will likely drive up rents in coming years.

Dwelling commencement figures recently released by the Australian Bureau of Statistics (ABS) show dwellings commencements have declined for the second quarter running. Construction on just 38,348 homes commenced in the three months to June, a seasonally-adjusted drop of 3.7% on the March quarter.

Source: My RPData

Trams could run from Helensvale to Coolangatta on the Gold Coast under a plan announced by the State Government today. Transport Minister John Mickel said light rail was the most likely option to bust crippling congestion on the glitter strip, where 20 per cent of all residents will live within 800 metres of the proposed line. It will stretch from Helensvale, Harbour town, the “knowledge precinct” of Griffith University and new Gold Coast Hospital site, Southport, Surfers paradise, Broadbeach, Burleigh Heads and on to Coolangatta.
Mr Mickel said the proposal provided the best option to combat congestion on the Gold Coast, where traffic was increasing by 4.3 per cent each year.
“Currently only 4 per cent, or 65,000 trips, are made by the Coast community on public transport, and with rapid transit it is projected to grow to 10 per cent by 2026.
“By making public transport faster, more efficient and more reliable, this project is estimated to take up to 40,000 car trips off the roads – that will have a significant effect. He said early indications were that private companies were keen to “get on board”.
“This is truly an international solution for an international city that enhances the Gold Coast’s reputation as a tourism and lifestyle destination”.
The first stage of construction is expected to begin by 2010.

Property or shares? Shares or property? The pair have been slugging it out for the investment crown ever since Adam Smith was a boy.
But today, with market conditions in Sydney, there’s an increasingly loud chorus proclaiming property investment the king of the ring, with many more happy returns.
“We see the returns from residential property being above pretty well all other asset classes, in risk-adjusted terms,” says economist Dr Alex Joiner, of ANZ Economics and Markets Research, who explains that risk-adjusted means the nominal yield is adjusted for the volatility of the asset class.
“We see the next six to 12 months as a period of softness in Sydney – and nationally – but the overall fundamentals will continue to tighten.”
Intrinsic to the debate are the recent sharemarket falls. Australian shares lost 13.4 per cent of their value in the year to June 30, even after dividends were included in the market’s performance. Listed property trusts fell by a collective 36 per cent.
At the same time, a record low in new housing construction, combined with vigorous population growth, mostly through migration, smaller household sizes and a dozen rises in interest rates since 2002, have created a critical lack of homes.
“The gap between supply [of residential property] and demand will support the market,” says Joiner, who puts the shortage for next year at about 200,000 homes nationally. He also compares the returns from equities and property in the graph (see right).
“This gap is set to get bigger over the coming years as pent-up demand becomes more acute and the population continues to expand.”