The press will tell you the property boom is over.
Don’t be distracted by the noise
The media loves a good headline and when it comes to Australian real estate, the ones they clamour for are all bluster about dire forecasts of bursting bubbles and plunging house prices.
One of the most prominent headlines last year was about the so-called ‘affordability crisis’.
But even many experts who once claimed that local house prices were over-inflated have since acknowledged the overwhelming evidence that in real terms (accounting for inflation), property values in the Lucky Country are in fact relatively more affordable now than when baby boomers were in their home buying prime.
I am an avid reader of all things real estate related of course, but even I’ve struggled to keep up with the peaks and troughs reported by the media over the last few years.
I recall at least four separate headlines that pronounced ‘the property boom is over’ across 2014 -15; only to be declared miraculously recovered again the following month when new, buoyant data was released.
And from memory the market hit its peak on more than one occasion, causing prices to allegedly soar into stratospheric new heights that once again had headline junkies declaring an ‘end of the Great Australian Dream’.
A slight problem
The one fundamental fact that these irritating, attention-grabbing headlines consistently fail to account for is that there is not one property market in Australia.
Fact is there are markets, within markets within markets.
So when the media suggests that ‘the boom is over’, which boom are they speaking of?
The one in Sydney’s inner city suburbs, where prices had languished at below average growth for so many years it was inevitable that the market would go through a period of catch up?
And what do they mean by ‘the boom is over’?
Have people stopped buying housing?
Do we no longer require this essential commodity for shelter?
Sure the Sydney property market has slowed down – it’s moved form 5th gear to 2nd or 3rd gear – and while property values have clearly fallen in some areas it’s definitely not in reverse for prime “investment grade” proeprties.
Picking and choosing what data to use and where it’s sourced from has a lot to do with the mis-information we seem to consistently receive around residential real estate market movements.
The fact is these are headlines that sell the slowly dying medium of print media or get us clicking on line, because human nature means we like a good doom and gloom story.
Don’t be distracted
One of the reasons people so willingly believe the worst of investment markets is it means they can justify their inaction.
“I won’t invest in real estate because it’s just a crash waiting to happen,” is a mentality that allows people to remain stagnant in their future financial planning.
And of course the media is aiding and abetting their apathy with this headline fodder dressed up as fact.
Fear is a big motivator and for property investors, can keep them anchored to the bottom of the property ladder indefinitely.
Of course it’s nigh on impossible to escape the ‘doom and gloomers’ entirely these days, given how much information is readily available through all number of digital channels.
So how do you prevent yourself from getting distracted by all the noise as you climb your way to financial freedom?
You begin your journey with a well developed map of where you want to be in five, ten, twenty and thirty years from now and then you look ahead, keeping your sights set firmly on your own objectives.
Then you examine the historical performance of investment grade property assets – the type you should be investing in if you want long-term financial success – and take comfort in knowing that it has consistently outperformed the averages over the long term.
Being a pro-active investor means growing your portfolio based on a clear strategy, not the market forces at play at any given time.
So leave the puppeteers of the press to their games of distraction and follow your own path to success, writing your own life’s attention grabbing headlines as you hit each milestone along the way.
There is no doubt that is year the property markets will be very, very different to last year.
If you want to avoid the minefields, but advantage of the opportunities you need to seek the guidance of someone who’s walked down this path before.
If you’re looking for independent advice, no one can help you quite like the independent property investment strategists at Metropole.
Remember the multi award winning team of property investment strategists at Metropole have no properties to sell, so their advice is unbiased.
Whether you are a beginner or a seasoned property investor, we would love to help you formulate an investment strategy or do a review of your existing portfolio, and help you take your property investment to the next level.
Please click here to organise a time for a chat. Or call us on 1300 20 30 30.
When you attend our offices in Melbourne, Sydney or Brisbane you will receive a free copy of my latest 2 x DVD program Building Wealth through Property Investment in the new Economy valued at $49.
Just click on this link to find out more and reserve your place.
Subscribe & don’t miss a single episode of Michael Yardney’s podcast
Hear Michael & a select panel of guest experts discuss property investment, success & money related topics. Subscribe now, whether you're on an Apple or Android handset.
Need help listening to Michael Yardney’s podcast from your phone or tablet?
We have created easy to follow instructions for you whether you're on iPhone / iPad or an Android device.
Prefer to subscribe via email?
Join Michael Yardney's inner circle of daily subscribers and get into the head of Australia's best property investment advisor and a wide team of leading property researchers and commentators.