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Property Investment Outlook 2013 by Michael Matusik

Happy New Year!  Let’s hope 2013 is better business-wise than 2012.

But most of us still have our health, in various states of disrepair, so that is something to be thankful for.

We Aussies also live in “the quiet slipstream” to quote Neil Young, whilst much of the world is in thunder.  So that, too, is something to be thankful for.

So what does 2013 hold in store real estate-wise? 

Well, it could be a fantastic year, with many markets showing big recoveries.  Or it could be lacklustre, just like much of last year.  It really all depends on you.

Go look in the mirror.  Are we going to continue being pessimistic or are we going to say enough is enough, it is time to move on?

For mine, the GFC is now pushing five and we are into the new normal.

There is no magic improvement, no quick upside.

But we have been hoarding money like the end is nigh.  And for mine, once we get our mojo back, some of the $1 trillion in term and other deposits will find itself into the property market, as will a proportion of the $1.5 trillion locked up in Australia’s superannuation funds.

A Bonus PowerPoint

But enough of the words already!  Find here a short PowerPoint presentation outlining what’s in store for 2013.

But, I cannot help myself, so here is a short summary:

First home buyers have very little momentum. 

They represent just 15% of the money in the Australian housing market.

There is no first home buyer upturn on the horizon for years to come.

Those who have to do any of the heavy lifting are more experienced owner-residents and investors.

Both segments show signs of improvement.

For mine, unless stamp duties are reduced, many owner-residents will wait until a recovery is well and truly underway before they buy and sell, and that probably isn’t on the cards for 2013, even if confidence returns, a Federal election is called early and the Aussie dollar falls and stays down.

So it is up to the investor to bear down and show some grunt.

And I think they will.  Their money is wasting away in cash, the share market is all over the shop and residential property returns are starting to look good; often positive.  So here’s to the investment market – 2013 is your year.  Don’t let us down.

The astute investor – and contrary to what the mass media says – knows that the property market cycles and that it turned the corner around the middle of last year. 

The table below outlines the past eleven residential cycles in Australia.  Things might be slow, but they are looking up.

The presentation includes my updated property clock – make sure you spend some time looking at slide seven.  They say a picture is worth a thousand words!   You will note, however, that many of Queensland’s markets are well positioned – between 5 and 9 – on the property clock.

And to that end, let’s now focus our attention on the Sunshine State.

It has been some time since the sun has shined on much of the State but the weather looks brighter for Queensland this year.

New dwelling starts have been slow, reflecting weaker population growth, but now population growth has improved and with it the potential for a supply v. demand imbalance.

If the investor’s appetite for Queensland property improves, and if Queenslanders can get out of their current funk, then the ingredients are here for a recovery in 2013.

It could be a strong one if more full-time jobs are created.  And whilst there were setbacks during 2011 and last year in this regard, the forecasts for economic growth (and job growth) are good for Queensland this year and next.

End prices are expected to rise by between 5% and 6% per annum over the next three years across most Queensland markets. Sydney, Perth and Darwin are expected to show similar gains.

The laggards are Melbourne, Adelaide, Hobart and Canberra.

A change in Federal party could see property prices actually fall in Canberra, if the past is any guide.

Now that, too, has brought a smile to my face.

Let’s make the most of this year.  FRUMP NO MORE.

………….

End notes

If you want to keep your comments private and confidential contact me directly on michael@matusik.com.au

Or give us the goods from the front lines – let us know what’s happening out there via twitter –@michaelmatusik #propertypulse.  You’ll have about 110 words after these two handles to share your comment/property news.

Or listen to me on Kevin Turner’s Real Estate Talk and his real estate show between 8am and 9am most Saturday mornings on 4BC1116.

……………

Michael Matusik is the director of independent property advisory Matusik Property Insights and writes the  Matusik Missive which is free, however, reprinting, republication or distribution of any portion of this material, or inclusion on any website, is strictly prohibited without the written permission of Matusik Property Insights and may incur a charge.

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Michael is director of independent property advisory Matusik Property Insights. He is independent, perceptive and to the point; has helped over 550 new residential developments come to fruition and writes his insightful Matusik Missive


'Property Investment Outlook 2013 by Michael Matusik' have 1 comment

  1. Avatar for Property Update

    January 11, 2013 @ 3:23 pm Hot property sunshine coast

    I love your quote ” …the GFC is now pushing five and we are into the new normal.” It really does makes us take a step back and think about whether the economy is struggling worldwide, or simply readjusting. We all know people by nature cannot stand change, which is whey an economic shift is met with such resistance, when really we should be viewing it as an opportunity…. here’s to a prosperous year for those willing to see it as one!

    Reply


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