We are being attacked by a silent enemy that understands the same principles that strategic property investors use – the power of compounding and leverage.
As investors we realise that capital growth, leverage and time are our friends as our assets grow exponentially – compounding and leverage gives us growth on our growth.
Unfortunately it’s much the same for the way COVID-19 is attacking us.
Our enemy is using us (our bodies) for leverage to help spread itself further and faster.
And because it is very contagious, as the following graphic from Visual Capitalist shows, it is using the power of compounding to spread its nasty tentacles.
The maths behind social distancing
Their infographic illustrates how a reduction in social exposure can theoretically contain the spread of infection.
|Scenario||5 Day Period||30 Day Period|
|No social distancing practiced||1 person infects 2.5* others||406 people infected as a result|
|50% reduction in social exposure||1 person infects 1.25* others||15 people infected as a result|
|75% reduction in social exposure||1 person infects 0.625* others||2.5 people infected as a result|
*For estimations only. It is not possible to infect only a fraction of another person.
To arrive at the figures reported above, Robert A.J. Signer, Ph.D., and his team made a number of key assumptions.
First, they estimated the basic reproduction number (R0) of COVID-19 to be 2.5, a figure supported by recent research.
This means that, on average, an infected individual will spread the disease to 2.5 other people.
Next, they assumed that an infected individual will unknowingly spread COVID-19 over the median five day incubation period.
After this period, the individual will begin to develop symptoms, immediately self quarantine, and no longer pose a threat.
Finally, they assumed a direct linear correlation between social interactions and R0.
This means that when an infected person reduces their physical contact with others by 50%, they also spread the disease by an amount 50% less.
We All Have a Part to Play
With the number of COVID-19 cases still rising, our governments have issued quarantine orders and travel bans.
The maths supports these decisions—reducing our physical contact with others, even when we aren’t experiencing any symptoms, is crucial.
The key takeaway from all of this? Social distancing is a powerful disease control tool, but only if we all participate.
Now is the time to take action and set yourself for the opportunities that will present themselves as the market moves on
If you’re wondering what will happen to property in 2020–2021 you are not alone.
You can trust the team at Metropole to provide you with direction, guidance and results.
In challenging times like we are currently experiencing you need an advisor who takes a holistic approach to your wealth creation and that’s what you exactly what you get from the multi award winning team at Metropole.
If you’re looking at buying your next home or investment property here’s 4 ways we can help you:
- Strategic property advice. – Allow us to build a Strategic Property Plan for you and your family. Planning is bringing the future into the present so you can do something about it now! This will give you direction, results and more certainty. Click here to learn more
- Buyer’s agency – As Australia’s most trusted buyers’ agents we’ve been involved in over $3Billion worth of transactions creating wealth for our clients and we can do the same for you. Our on the ground teams in Melbourne, Sydney and Brisbane bring you years of experience and perspective – that’s something money just can’t buy. We’ll help you find your next home or an investment grade property. Click here to learn how we can help you.
- Wealth Advisory – We can provide you with strategic tailored financial planning and wealth advice. Click here to learn more about we can help you.
- Property Management – Our stress free property management services help you maximise your property returns. Click here to find out why our clients enjoy a vacancy rate considerably below the market average, our tenants stay an average of 3 years and our properties lease 10 days faster than the market average.
Source: Visual Capitalist
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