One of my biggest bugbears with media reporting of late is the insistence that there is one Australian property market.
Of course, savvy investors know that there is no such thing, yet we continue to read about the woeful state of “the market”.
I’m sorry, but that is complete rubbish!
Australia is not only its own country, but our huge land mass is also made of eight different states and territories, which each have their own governments, their own economic strengths and weaknesses, and their own property markets.
In fact, in each capital city market, there are also different markets, too.
The same goes for our many major regional locations that boast diverse economies, often hundreds of thousands of people who live there and, again, their own unique property markets.
According to the latest data, Australian dwelling values are “falling”.
Clearly, the problem with this statistic is that it is derived from combining every market in the land, which are experiencing different market cycles at the same time.
As we all know, Sydney dwelling values have softened by about seven per cent over the past 12 months, with Melbourne’s reducing by nearly five per cent.
The problem is those figures reflect a macro point of view when at a micro level there are still locations producing sound results.
There are plenty of locations in Sydney and Melbourne that continue to record price growth because of the strong demand from people who want to live there, but you wouldn’t know that if you only looked at the headline figures.
So, while Sydney and Melbourne are continuing to hog the headlines and drag down the “national market”, other locations seem to have been conveniently forgotten.
Let’s consider Brisbane, for example, where its city median price is admittedly not doing much but where its many diverse markets are actually performing quite nicely.
The latest data from the Real Estate Institute of Queensland (REIQ) shows that Brisbane’s median house price increased by 2.5 per cent to $673,000 over the year to June.
The thing with Brisbane is that it is much more than just its capital city with its four adjoining council areas performing just as well, if not better than, the State city.
Take Moreton Bay, for example, which is located north of the city, and is home to a growing population of 425,000 people.
According to the REIQ, its median house price increased three per cent to $440,000 over the 12 months to June.
Sure, some people will think this isn’t a particularly spectacular result, but it is when you consider what is happening in Sydney and Melbourne at present.
Markets on the move
Which brings me to my next point, capital cities like Brisbane and Adelaide as well as regional locations like Geelong usually do post dwelling value increases every year.
They might not be seen as “sexy” results by those used to the recent unsustainable growth in Sydney, but they generally trend upwards in a steady and stable way.
Plus, Brisbane has been forecast to lead the way for price growth over the next three years, due to its multibillion-dollar infrastructure projects, including game changers like the Cross River Rail and Queen’s Wharf, as well as strong interstate migration.
I guess what I’m trying to say is that property investment remains a sound wealth creation strategy because of the number of strong locations around the country.
As well as Brisbane, Adelaide’s market appears to be on an upswing, as does Canberra’s.
Hobart, as you probably know, also has had a stellar run over recent times, and it’s nothing like Sydney or Melbourne from a city size point of view.
As the end of the day, there remain a plethora of property investment prospects across the country – as long as you can look past some of the alarmist headlines that are bemoaning the state of our supposed “national market”.
Source: API/Ripehouse – Daniel Walsh, Buyers Agent