Hotspotting: Recent Episodes

Terry Ryder

Uncovering hot property markets, today. Hotspotting has always been about helping investors find the best location to buy based on quality research. The Hotspotting Podcast is a Real Estate Property Investment show and delivers this information and more! In each episode Terry Ryder from Hotspotting will bring you knowledge and interesting conversation on everything a property buyer wants and needs to know to make informed decisions. From unravelling the latest data, trends and market statistics, discussing areas of growth and the bigger issues influencing Australia’s property landscape. Whether you're a seasoned property investor or you're buying your first home, we’re here to build your knowledge. Knowledge gives you the power to make smarter investment choices.

About Terry Ryder

Terry Ryder is the founder of hotspotting.com.au.

For 32 years, Terry Ryder has been a specialist researcher/writer on residential property in Australia. In 2006 he created Hotspotting.com.au to help investors find the best places to buy. Terry’s reports and commentary are based quality data and information. His views are totally independent and free of vested interests or outside influences.

Navigating Today’s Property Market with Terry Ryder

In this episode, Terry Ryder—Australia’s leading property analyst and founder of Hotspotting—joins host Adam Horth of Smartre Training to unpack the true state of the Australian real estate market.

Drawing on decades of research and market-watching, Terry delivers a clear-eyed analysis of property trends and growth prospects across the country, breaking it down state by state. From regional hotspots to shifting buyer behaviour, this conversation sheds light on what’s shaping the market right now—and what smart investors need to watch next.

Terry also shares what it really means to be a property investor in today’s climate. From rising interest rates and tight supply, to the strategies that still work despite the noise, this episode is packed with practical insights for those serious about long-term success in real estate.

Plus, don’t miss Terry’s top book recommendations for investors and business builders alike:

Built to Sell by John Warrillow
The War of Art by Steven Pressfield
The Road Less Stupid by Keith J. Cunningham

For more resources and upcoming events, visit:

Smartre Training Programs
Smartre’s Top Performers
Seminars and Events
Submit your Field Challenger

Whether you're a seasoned investor or just getting started, this episode offers the clarity and direction you need to navigate the property market with confidence.

Tune in and make your next move a smart one.

Think Sydney and Melbourne lead the property market? Think again.

In this episode, we reveal the surprising frontrunners from the Winter edition of The Price Predictor Index — and it’s the smaller capitals and regional markets stealing the spotlight.

📍 Darwin tops the list as Australia's hottest market 📈 Hobart is making a powerful comeback 🏡 Regional South Australia and Regional Victoria are quietly outperforming 📉 Meanwhile, Sydney is now the weakest market nationwide

We dig into why these shifts are happening, what’s driving demand in unexpected places, and where the next price growth could emerge.

If you're an investor, buyer, or just watching the market, this episode gives you early insight into what’s next — before the headlines catch on.

👉 Tune in to discover the markets flying under the radar (for now).

What’s really happening in Australia’s property markets?

In this episode, we break down the new Winter edition of the Price Predictor Index — and the results are anything but expected.

🏆 Darwin has skyrocketed to become the hottest market in the country, with sales activity going ballistic. 📈 Hobart is making a strong comeback after a quiet spell. 📉 And Sydney? It's the only capital we’ve labelled a Loser this quarter.

We reveal the cities and regions where buyer demand is surging — and where it's slipping — plus the Top 50 Supercharged Suburbs that are primed for growth.

If you're a property investor, professional, or just property-curious, this episode is packed with forward-looking insights you won’t hear anywhere else.

👉 Tune in to find out where the next boom could be brewing.

Why Moving House Costs More Than You Think

Thinking of moving home? It’s not just about finding the right property anymore — the real hurdle is the staggering cost of moving.

In cities like Sydney and Melbourne, transaction costs for selling, buying, and relocating now average over $100,000.

For many, this financial burden is a major reason they stay put, even when their current home no longer suits their needs.

The biggest single cost? Stamp duty — a tax often called the silent killer of housing mobility.

Why is this outdated tax still strangling the market, and how could reform unlock hundreds of thousands of homes across Australia?

Join us as we explore the hidden costs, the impact on families and the economy, and why political leadership is urgently needed to break this costly cycle.

Affordable Housing: The Great Political Mirage

Politicians love to promise “affordable housing” — but where are the numbers?

Behind the headlines and media events, affordable homes remain an elusive dream, buried under soaring land prices, construction costs, and government taxes.

From Brisbane’s zoning reforms to Sydney’s grand plans, we unpack why these announcements often fall short of reality.

Why is genuine affordability missing from the conversation?

And what’s really stopping new homes from becoming truly affordable?

Tune in as we cut through the spin and reveal the hard truths about Australia’s housing crisis.

Is Australia really heading into the “grandaddy of all property booms” just because of a couple of interest rate cuts? If you believe the headlines, that’s exactly what’s happening. But here’s the problem: those headlines are mostly rubbish.

In this episode, we cut through the media hype and take a hard look at what’s really driving property prices – and it’s not interest rates. From shallow journalism to economist echo chambers, we expose the flawed logic behind the property boom narrative and explain why it doesn’t stack up against real data or historical precedent.

Join us as we unpack the truth about housing supply, buyer demand, and the political dysfunction fuelling affordability woes. If you’re buying, selling, or just trying to make sense of the chaos, this episode is your reality check.

Forget the hype. Get the facts.

How does someone go from trading commodities in New York City to selling some of Melbourne’s most luxurious homes? In this episode of The Property Playbook, host Tim Graham sits down with Nicholas Brooks, Director of Marshall White Stonnington, to explore his unique journey into real estate and what it takes to thrive in the top end of Melbourne’s property market.

🔑 What you'll learn in this episode:

Nick’s transition from finance in New York to high-end real estate in Melbourne

What makes Stonnington one of Melbourne’s most desirable property regions

The current trends in Melbourne’s luxury property market

Why premium marketing matters when selling high-end homes

How unit markets are making a comeback—and why savvy buyers are taking notice

Key advice for sellers looking to achieve top dollar in today’s market

💬 Notable Quotes:

“You can’t be everything to everyone. Work out your speciality, just like you would with a doctor. People want the expert.”

“When you only get one shot to make a property shine, marketing is everything.”

If you're fascinated by luxury real estate, curious about Melbourne’s property market, or want tips on standing out as a seller, this episode is for you.

You can connect with Nick by visiting:

https://www.marshallwhite.com.au/agent/nicholas-brooks

🎧 Listen to the full epside on Spotify, Apple Podcasts, and all major podcast platforms.

👉 Brought to you by Hotspotting.com.au

Australia is one of the most urbanised nations on earth, but how is its population growth reshaping the map?

New data from .id reveals surprising trends across the country’s fifty largest cities and towns. Some regional centres are surging ahead while others are slipping behind. The Sunshine Coast has quietly become the fastest growing city in the nation, just ahead of Perth. Geelong, Ballarat and Hervey Bay are rising fast, while places like Whyalla tell a very different story.

Melbourne has overtaken Sydney again, and a small but booming area in Lake Macquarie has broken into the top fifty for the first time.

What do these population shifts reveal about the future of Australia’s property market?

And which cities could be the next major investment hotspots?

What do some of the highest rental yields in Australia have in common with some of the biggest property busts?

In this episode, we explore the darker side of high yield towns and why some locations that promise strong returns can become financial traps. From Moranbah to Port Hedland, the history of boom and bust in resource-driven towns is littered with painful lessons.

Why are some towns offering yields above 12 percent while their property values plummet?

What really lies beneath the glossy headlines and impressive statistics?

And why are so many of these markets cheap for a reason?

This episode unpacks the data and the real stories behind twenty towns investors should think twice about.

Why does it now cost nearly a million dollars to build a basic home in Australia?

The latest NAB Residential Property Survey reveals some uncomfortable truths. Construction costs are soaring, government taxes and delays are adding layers of expense, and productivity in the building sector has fallen dramatically over the past 30 years.

Yet investors are still being blamed for rising prices, even though they make up just a quarter of buyers. So what is really driving the housing crisis?

If you want to understand the forces shaping property prices, affordability and supply across the country, and what the media is not telling you, listen to this episode today.

🎙️ Why the Election Won’t Fix the Housing Crisis

Australia has voted — but will the Federal Election result change anything for the housing crisis? For real estate consumers, the answer is... probably not.

In this episode, we cut through the political noise and unpack what the election outcome really means for home buyers, investors, renters, and the property industry.

While the re-election of the Albanese Government may provide short-term relief for homeowners, it offers little hope for renters or first-home buyers — because, quite simply, the government still doesn’t understand the root causes of the housing crisis.

We discuss: ✅ Why the Greens’ wipeout is actually good news for the housing sector ✅ How both major parties have failed to present real solutions ✅ The continuing imbalance between housing demand and supply ✅ And why the promise to build 1.2 million homes is already off-track

We also outline what’s actually needed to fix the housing crisis — from tax reform and trade shortages, to meaningful incentives for investors and builders.

If you're tired of the political spin and want to hear what really needs to change, this episode is for you.

This was one of the most highly anticipated and highly attended webinars of the year — and for good reason.

In this exclusive session, Hotspotting founder Terry Ryder and iBuyNew CEO Daniel Petersen explore the powerful impact the 2032 Brisbane Olympic and Paralympic Games will have on property markets across South East Queensland.

✔ Learn from case studies of past Olympic host cities, including Sydney, Athens, London, and Tokyo

✔ Discover how infrastructure, population growth, and legacy planning have driven real estate booms

✔ Understand why Brisbane is poised to outperform every other Australian city over the next decade

✔ See the key suburbs and property types set to benefit most

✔ Preview real investment opportunities in Kangaroo Point and Milton, Brisbane Whether you’re a first-time investor or building a portfolio, this session will help you understand why the time to act is before the Olympic flame is lit.

🔗 Book a 1:1 discovery session with the iBuyNew team to discuss tailored investment options: https://calendly.com/d/crbh-mzr-ztc/brisbane-olympic-investment-opportunity

For more information on iBuyNew and to connect with Dan and his team, you can visit: www.ibuynew.com.au

🎙️ Perth Property: Boom or Bust? Cutting Through the Noise

In the confusing world of real estate commentary, how do you know who to trust?

In this episode, we unpack the conflicting headlines surrounding the Perth property market — with some claiming the boom is still raging, while others say it’s well and truly over. So, who’s telling the truth?

We expose the dangerous influence of vested interests in property media and explain why so much of what gets published is little more than PR spin. You'll hear why independent analysts from CoreLogic (Cotality), PropTrack, and Domain are painting a very different picture from industry groups like REIWA — and why that matters to you as a property investor or buyer.

We also share Hotspotting's current view on Perth and Western Australia: ✔️ Why the broader Perth boom has likely peaked ✔️ Where genuine opportunities still exist (think apartments and key regional hubs) ✔️ And why you should always dig deeper than the headlines

This is a must-listen for anyone serious about making informed real estate decisions — and tired of being misled by hype.

🎙️ The Positive Cashflow Property Myth Busted

Think high interest rates mean goodbye to positive cashflow? Think again. In this episode, we break down why smart investors are still finding strong cashflow opportunities right now across Australia.

We explore the truth behind the long-held myth that you can’t have high rental yields and capital growth — and reveal why this old idea no longer holds water. From booming regions like South Australia, Western Australia and Queensland, to overlooked gems like Darwin (the nation’s most affordable capital), there are markets offering:

✅ Affordable entry prices ✅ Gross yields above 6% (and even 7%+) ✅ Strong prospects for capital growth

We also talk about how attached dwellings — like units and townhouses — are emerging as serious contenders for investors looking for strong returns, lifestyle appeal, and lower maintenance.

Tune in to discover why the trifecta of affordability, yield, and growth is more achievable than ever — and why our Top 10 Positive Cashflow Hotspots report is flying off the shelves.

Government support for first-home buyers always seems to spark the same criticism: that it drives up prices and does more harm than good. But where’s the evidence?

In this episode, we unpack the recurring claims that FHB schemes like deposit guarantees and grants inflate property values — and ask why these arguments persist despite a lack of supporting data.

We explore how media narratives often miss the mark, focusing blame on young buyers instead of tackling the real issues: supply constraints, high construction costs, and planning bottlenecks.

If helping first-home buyers is always the “wrong move,” what’s the alternative?

In this episode:

The myth that FHB support causes price spikes
What the data actually says (and doesn’t say)
Why the supply-side crisis is the real problem
How policy debates are missing the point

This episode is for anyone who’s ever wondered whether helping first-home buyers is hurting the market — and wants an evidence-based perspective instead of a political spin.

After several years of standout growth, Perth’s housing market is starting to cool — but that doesn’t mean it’s headed for a fall. In this episode, we break down the latest indicators showing that Perth’s price growth has slowed, even as the state’s economy remains one of the strongest in the country.

We also look beyond the capital to Regional WA, where several markets continue to perform strongly, and explore what investors should watch for next.

In this episode:

Why Perth’s growth has passed its peak
The latest data on price movement and sales activity
How strong economic fundamentals are supporting WA markets
Opportunities that still exist in units and regional areas

If you're tracking the next move in WA’s property cycle, this episode gives you the data and context to stay ahead.

Scapegoating has become Australia’s unofficial national sport — and nowhere is this more obvious than in the commentary surrounding our housing crisis.

In this episode, we take a deep dive into the latest wave of finger-pointing, where so-called NIMBYs (Not In My Back Yard) and Baby Boomers are being blamed for everything from unaffordable housing to stalled development.

But is the narrative that older Australians are refusing to downsize or that local residents are blocking new homes actually backed by evidence? Or is it a convenient distraction from deeper, more uncomfortable truths?

Tune in as we cut through the noise, challenge the conventional media narrative, and call for a more honest, evidence-based conversation about housing supply, planning, and political accountability.

Key topics covered:

The myth of downsizing as a supply solution
How NIMBY scapegoating distracts from systemic problems
Why development isn’t happening in many suburbs — and it’s not because of residents
The true barriers to building new homes in Australia
What needs to change for real housing reform to happen

If you're tired of the blame game and ready for a more informed look at the housing crisis, this episode is for you.

In this episode, we challenge the growing media and political narrative blaming older Australians for the housing crisis.

With new data from Australian Seniors and PropTrack, we unpack why the push to guilt Baby Boomers into downsizing is not only misguided — it's deeply unfair and factually wrong.

We expose the lazy policy thinking behind the idea that empty nesters are hoarding homes, and explain why the real culprits are chronic supply shortages, failed planning systems, outdated pension rules, and a political class allergic to real reform.

From rising relocation costs to a lack of suitable alternatives, we examine the complex reasons why downsizing isn't the easy fix the headlines claim.

This is a must-listen for anyone tired of shallow blame games and looking for real solutions to Australia’s housing crisis.

In this episode, we dive deep into one of Australia’s most remarkable and resilient property markets—Adelaide.

While other cities like Perth are losing momentum, Adelaide continues its upward trajectory, now entering its sixth year of steady growth.

Backed by data from Hotspotting’s latest Price Predictor Index, we unpack why buyer demand remains high, which LGAs are leading the charge, and how Adelaide’s long-dismissed real estate market has evolved into a national frontrunner for capital growth.

We’ll explore the suburbs showing the strongest signs of continued price increases, the economic drivers supporting the boom, and why Adelaide has surpassed even Melbourne in median dwelling prices.

Whether you're an investor or just fascinated by real estate trends, this episode reveals why Adelaide remains a hot market worth watching.

With over 15,000 suburbs across Australia, how do you know where to invest next—and which markets are set to outperform?

In this episode of The Property Playbook, host Tim Graham sits down with Australia’s leading property analyst, Terry Ryder, to reveal the latest insights from Hotspotting’s National Top 10 Best Buys report.

Unlike media-driven “hotspots,” these locations have been handpicked for their long-term growth potential, strong local economies, and critical infrastructure investment.

🎯 In this episode, you’ll learn:

Why the best investment markets aren’t the ones booming now, but the ones poised for their next surge
The key traits shared by Australia’s future growth markets
Why Darwin has re-emerged as a major opportunity for investors
How second-wind markets like the Sunshine Coast and Launceston are making a comeback Why Melbourne and regional Victoria are primed for smart investors
How to use the Top 10 Best Buys to find locations that match your investment goals and budget

📚 Ready to stop chasing headlines and start investing smart?

Access the full National Top 10 Best Buys report with an exclusive discount—use coupon code TICKER.

👤 Guest: Terry Ryder – Founder of Hotspotting.com.au

🎙️ Host: Tim Graham

📺 Catch more episodes of The Property Playbook here: https://tickernews.co/shows/the-property-playbook/

🌐 Get the Report: https://www.hotspotting.com.au/product/national-top-10-best-buys/

As the federal election approaches, housing policy has finally hit the spotlight — but not for the right reasons.

In this episode, Terry Ryder cuts through the spin and dive into the political theatre playing out between major parties over Australia's housing crisis.

From vote-chasing tax perks to demand-boosting band-aid schemes, he unpacks why both Labor and the Coalition are missing the mark — and how their policies could actually make things worse.

Plus, he takes aim at the Greens’ rental rhetoric and ask the question no one seems to be answering: where are the real structural reforms?

If you’re tired of housing headlines full of sugar and no substance, this one’s for you.

With housing affordability now a key battleground in the federal election, Tim Graham, Managing Director of Hotspotting, joins Ahron Young on TickerNews to unpack what the major parties are promising—and whether those policies will make any real difference.

In this episode, Tim explains why most policies on offer are short-term, demand-side sugar hits that fail to address the root of Australia’s housing crisis: supply.

🎯 In this episode, you’ll learn:

Why tax deductions and super-for-housing schemes may push prices up
The unintended consequences of government stimulus for first-home buyers
The critical need for supply-side reform and planning overhauls
Why medium-density housing and cutting red tape are key to solving the crisis
The reality behind housing announcements that never get delivered
Why developers are avoiding Victoria—and how to turn that around

📢 A straight-talking look at what’s broken, what’s needed, and how to really fix housing in Australia. 👤

Guest: Tim Graham – General Manager, Hotspotting.com.au

🎙️ Host: Ahron Young – Anchor, TickerNews

🌐 Catch more episodes of Ticker at: https://tickernews.co/shows/the-property-playbook/ ----------

In this episode, Terry Ryder dismantles the media myths surrounding landlords and reveals a far more sobering reality — most investors aren’t profiting, they’re bleeding cash.

With 65% operating at a loss and many forced to sell, Ryder explores why the rental market is under serious threat.

From rising interest rates to hostile policies, he exposes how the system is pushing mum-and-dad investors to the brink — and why that spells trouble for renters too.

If you're a property investor, tenant, or just someone trying to make sense of Australia's housing mess, don’t miss this episode.

Subscribe now, leave a review, and share it with someone who needs to hear the truth behind the headlines.

The facts matter — and Terry Ryder is here to set the record straight.

Perth's Property Market at its Peak:

Tim Graham discusses the shift in Perth's property market as it reaches its peak. He shares insights from Hotspotting's Price Predictor Index, explaining how rising sales activity often leads to price growth, and how Perth's market is now experiencing a slowdown due to decreasing sales.

Why Perth Was Doing Well:

The strength of Perth's recent growth can be attributed to a proactive state government, affordability, and a resurgence after many years of stagnant prices. Tim highlights how the state's openness to investors has played a key role in this boom. The Emergence of New Market

Leaders: With Perth cooling down, other markets are emerging as leaders. Tim explains that Melbourne, despite economic challenges, is showing positive rankings in many suburbs. With a correction in its market and its relative affordability compared to Sydney, Melbourne is attracting new investment.

The Impact of Affordability on Investment: Tim shares his thoughts on why people are moving to more affordable areas, not just due to COVID, but as part of a broader trend of seeking better lifestyle options. The ongoing affordability factor in Melbourne and other markets is a key driver of growth.

Infrastructure Projects and Market Impact: Tim discusses how infrastructure developments, like the Westgate Tunnel project in Melbourne, are expected to influence property prices, particularly in the city's west. However, he questions whether these infrastructure projects will be a game changer for the market. Interest Rates and

Housing Affordability: The conversation touches on the possible future of interest rates in Australia. Tim explains that the biggest challenge in real estate isn't interest rates but the lack of housing, which continues to drive prices up despite rate changes.

overnment Policy and the Housing Shortage: The interview wraps up with a discussion about the Victorian government's efforts to alleviate housing affordability, including stamp duty discounts. Tim points out the unintended consequences of these policies, suggesting that the focus should be on helping developers to start new projects.

In this update, Tim Graham from Hotspotting breaks down the key insights from the Autumn 2025 edition of the Price Predictor Index — revealing which Australian property markets are rising, which are steady, and which are slipping into decline.

We analyse 14 major jurisdictions across the nation — from capital cities like Darwin, Melbourne, and Adelaide to regional powerhouses like Regional South Australia, Regional Queensland, and Regional Victoria.

With detailed suburb-level insights and sales activity trends, this update highlights the suburbs and towns with real momentum behind them.

📍 Highlights Include:

Darwin’s surge to the top: 79% of markets showing growth
Melbourne’s strongest recovery in years
Regional SA’s quiet dominance
Sydney and Canberra’s rising unit markets Brisbane, Hobart, and
Adelaide’s ongoing stability
Where Perth is finally showing signs of slowdown
Underrated regional markets worth watching
Whether you’re an investor, a buyer’s agent, or a real estate professional, this video gives you the edge in identifying where the next wave of growth is happening — before the rest of the market catches on.

📘 Grab a copy of the Autumn 2025 Price Predictor Index report here: 👉 https://www.hotspotting.com.au/product/price-predictor-index/

One of the most significant housing stories in the past year has slipped under the radar of news media, with very little commentary.

The latest official data from the Australian Bureau of Statistics shows that it now costs over $500,000 to build the average house in this country. That’s the cost of construction of the dwelling and doesn’t include the land price.

Given that the price of residential land is also escalating to record price levels, the reality is that the typical house and land package in a capital city is beyond the reach of most young buyers.

This, in simple terms, is the essence of the housing affordability problem that has created a national crisis.

Australia needs to build more homes – a lot more than the industry is currently able to build – but the obscenely high cost of building both houses and apartments is the largest single barrier to achieving it.

The latest ABS figures tell a very sad story. They show that the nation, in 2024, fell 70,000 home approvals short of the target set to fix the housing crisis – AND that home building costs have hit a grim new record high.

Latest Australian Bureau of Statistics figures show there were 170,719 homes approved in 2024, the second worst annual figure since 2012, with experts warning government efforts to address the housing crisis so far have failed to make a difference.

And affordability is getting worse, with the average cost of building a new house in Australia surpassing $500,000 for the first time in December, according to the ABS data, made worse by new requirements for sustainable builds.

Making a bad situation considerably worse is the soaring cost of home sites.

The Housing Industry Association says that surging land values are problematic for the struggling development sector, which is already battling soaring labour and materials costs.

Extreme housing block costs have also coincided with falling prices for established houses – making the significant premium on brand new homes a hard sell for builders.

Housing Industry Association figures showed the median price of land across Greater Sydney now stands at $2,000 per square metre. That means that even a tiny 300 square metre block of land costs $600,000.

Land prices are less – but still very expensive – in Melbourne, where that small block costs $320,000, and it’s similar in both Perth and Brisbane.

But that 300 square metre block is below the normal block size. In Sydney the median lot price is $710,000 compared to around $400,000 in both Melbourne and Brisbane.

Add on that typical cost for building a home – and it makes a new house on land over $900,000 in Brisbane and Melbourne – and around $1.2 million in Sydney.

Housing Industry Association economist Maurice Tapang said the dramatic extra costs of buying land and building, versus buying established homes, could squash demand for new homes. Tapang said the price of land was now the biggest constraint on new housing construction in Australia’s capital cities.

PropTrack economist Paul Ryan said: “It’s becoming increasingly hard to make new housing equations stack up. There’s lots of choice for established homes and the prices have gotten relatively more attractive compared to new homes, and that’s something we’ve heard a lot of from developers”.

The HIA-CoreLogic Residential Land Report showed that the median price of a capital city lot increased by 9.2% in the September quarter to $408,160 compared to a year earlier.

Tapang said: “Land prices have risen three times faster than the rate of growth in the ABS Consumer Price Index (CPI) and five times faster than growth in the cost of home building materials as measured by the Producer Price Index for the September quarter 2024.”

At the same time, the cost of building a house now averages $537,000 nationally, according to the ABS, following the hyperinflation of construction costs since the pandemic.

Add those two figures together – the median lot price and the average cost of building a house – and you have $945,160.

And that, in one sentence, is the affordability issue. But I haven’t heard a single politician in Australia, at any level, suggest a policy to deal with this ridiculously high cost for new homes.

And it begs the question: are politicians in government around Australia even aware that the cost of a new house on land is getting scarily close to $1 million?

Price data for Sydney provides a striking example of why it’s so important not to generalise about property markets.

According to the big-name research sources, Sydney prices grew only a few percent overall in the past 12 months, but individual precincts within Greater Sydney have recorded price growth at boom levels.

Unfortunately for people trying to make informed real estate decisions, economists and journalists like to speak about “the Australian property market” and forecast what will happen with “Australian house prices” in the year ahead.

This is not only worthless information for Australians consumers, but it shouts very loudly that the economists and journalists making those generalisations know very little about residential real estate.

Even data on “Sydney house prices” is misleading and next to useless, because it tells us nothing about what’s happening in the Northern Beaches suburbs or in the many locations within the Canterbury-Bankstown LGA or out at Blacktown or further west at Penrith.

Because some of the individual precincts within the Greater Sydney metropolitan area have booming property markets.

According to PropTrack data, Sydney’s median house price grew just 2.5% in the past 12 months, but Hotspotting analysis shows that most of the suburbs in the City of Canterbury-Bankstown rose by 12-15% and some suburbs increased more than 20%.

Several of the unit markets in this LGA have also recorded double-digit growth in their median prices.

It’s because this precinct is an out-performer within the Greater Sydney area that we have been featuring it as one of our main recommendations for Sydney over the past 12 months or so.

In the Bayside LGA, another market we have recommended in our Top 5 Sydney Hotspots report recently, many suburbs have recorded median price growth well above 10% in the past year – and this includes both house and unit markets.

It’s worth remembering that more than half of all sales across Greater Sydney now are attached dwellings – units, townhouses, apartments. The market share of houses on land has been falling steadily over the past 12-18 months and now attached dwellings dominate.

Several of the unit markets in the Bayside LGA, including some that have median prices in the $700,000s, have recorded double-digit annual price growth in defiance of the average results for Greater Sydney.

It's true also of the Inner West LGA, which is increasingly dominated by attached dwelling sales. The median house price in most suburbs is well above $2 million, but many suburbs have median unit prices in the $800,000s and $900,000s – and some of those have recorded median price growth in the 7% to 12% range in the past year.

Again, this is well above Sydney averages – and it highlights the key message, that real estate is local in nature and that buyers should be focusing on the areas that are likely to perform city norms.

And 2025 will be no different.

The trend we have dubbed the Exodus to Affordable Lifestyle is one the key reasons we expect Regional NSW to deliver strong residential property markets in 2025.

The trend, of course, is not new – with big cities like Sydney losing population to internal migration for the past 10 years.

But the trend remains strong and has not slowed down or reversed, despite forecasts by some economists that there would be a movement of people back to the cities - with big businesses demanding that workers return to the office rather than work remotely.

The latest vacancy rate data for office space around Australia shows that the “return to the office” movement is not happening in a major way.

The Property Council of Australia, which represents the big end of town including major developers and owners of office buildings, is trying to put a positive spin on it, but the reality is that office vacancies overall are not improving in Australia as the work remotely trend continues to impact the top end office market.

The new Property Council report show than more offices were empty across the country in January than six months ago as the work from home trend continues to create headaches for Australia’s big-city landlords.

Australia’s office vacancy rate nudged up from 14.6% to 14.7% over the six months to January, the latest figures from the Property Council show. That’s a very small rise – but the expectation was that vacancies would be falling significantly by now, as people move back to the cities and return to the CBD office buildings.

In Sydney, home to many finance, insurance and tech workers, the vacancy rate jumped from 11.6% to 12.8%, while the number of empty floors in Melbourne remained unchanged, at a historic high of 18%.

Indeed, office vacancy rates are between 9% and 18% in seven of the eight state and territory capital cities. The highest at 18% is Melbourne which is the basket case among the nation’s economies and property markets of all kinds.

The Property Council called for “Active leadership” from the Victorian State Government to turn around the fortunes for Melbourne, which has Australia’s second largest CBD, the Property Council says.

The AFR reported that major companies last year issued mandates for their staff to return to the office, but these figures show it’s not happening in any major way – and both Melbourne and Sydney continue to have huge vacancies.

The movement of people from the biggest cities to regional areas is all about affordability and lifestyle, but enabled by technology which allows more people to work remotely – which is why office vacancies are so high.

Sydney, with a median house price around $1.2 million, has been steadily losing population and a proportion of that has been relocating to regional NSW, where the median house price is about $750,000 and plenty of regional cities and towns have houses on offer for less than $500,000.

This is a key reason why Regional NSW outperformed Sydney on price growth recently. In the past 12 months Sydney’s median prices have risen 1.9% for houses and 1.1% for units, while Regional NSW has managed 3% for both houses and units – with a number of individual regional markets doing considerably better than those averages.

Many suburbs of Wollongong have increased 7-9%, and a number of Newcastle suburbs have recorded double-digit growth in their median house prices, as have some of the Albury locations and several of the suburbs of Tamworth.

A recent analysis conducted by Hotspotting ranked the eight capital cities and six state regional markets – a total of 14 major jurisdictions – from 1 to 14 based on a series of different metrics and Regional NSW ranked 6th out of 14 for price growth prospects in 2025.

At Hotspotting, we expect 2025 to be a solid year overall in Regional NSW markets – but you need to see our Top 5 Regional NSW Hotspots report to find out which locations will perform the best and out-perform market norms – this year and beyond.

Prospects for strong buyer demand in 2025 look good, with the latest data released by the Reserve Bank indicating a significant rise in loans for home buyers, investors and businesses.

This challenges earlier predictions of a slowdown by economists, who continue to be obsessed with interest rates as the big factor that determines everything in real estate – despite all the mountains of evidence to the contrary.

Loans to residential property investors are the highest for two years, while loans to home buyers are the highest in 18 months.

The official data shows that, as at the end of December, annual business credit growth had reached 8.9%, marking the highest growth rate since May 2023.

Similarly, growth in investor loans for residential property reached 5.1% in December 2024, up from 4.7% in November, achieving its highest growth rate since December 2022.

Owner-occupied mortgage lending also grew, maintaining an annual growth rate of 5.7%, the highest since April 2023.

These increases have occurred despite stubbornly high interest rates and notwithstanding the forecasts from major economists that real estate demand and prices would fall because interest rates have remained unchanged at those high levels since November 2023.

Strong demand has continued because the national population has been rising strongly, boosted by high levels of migration from overseas; because the labour market has been quite strong and wages have risen; because most people got a tax cut in the middle of last year – and overall borrowing capacity has been pretty good.

In addition to those national factors, there have been myriad local factors which have caused individual property markets to boom.

Perhaps the biggest single factor is that there is an unprecedented level of infrastructure development – over $500 billion in projects under way in the past year and more in planning – and this creates high levels of economic activity and employment, which translates into demand for real estate.

It all bodes well for a solid year in residential real estate, with further impetus likely to come from reductions in interest rates – and possibly a change in federal government, which looks increasingly likely.

But keep in mind that real estate is local in nature – and there will be out-performers in 2025, as there were last year and indeed in every year in recent memory.

Hotspotting has been forecasting, recently, changes in the pecking order of price growth among the major markets of Australia – and the latest research data confirms it.

Regional real estate and apartment markets are the out-performers in the latest figures from CoreLogic – which also show that Perth is no longer leading the nation on price growth.

For some time now, regional Australia has been showing better growth on average than capital city Australia and the latest figures to the end of January show that this, generally speaking, is still the case.

In January the average situation for the capital cities was a small decline of 0.2% in the median house price, but a 0.4% rise for the combined regions.

In the past quarter, capital cities have dropped 0.7% while the combined regions have risen 1%.

It’s a similar story with apartments: the capital cities on average dropping a little but the regions delivering solid growth.

With house prices, looking across the 15 major market jurisdictions (eight capital cities and seven state and territory regional markets), 9 of the 15 have recorded increased their house prices. And, similarly, 9 of the 15 have lifted their apartment prices.

One of the key factors revealed by this new price data is the Perth growth rates are dropping sharply. After leading the nation on house price growth over the past two years, Perth is no longer at the top of the charts.

In January, the leading capital cities for house price growth were Adelaide and Darwin – and in the past three months it’s been Darwin, Adelaide and Brisbane, all ahead of Perth.

The regional markets of South Australia, Queensland and Tasmania have also done better than Perth in the latest quarter.

One of the fundamental factors we look for at Hotspotting when assessing locations is infrastructure.

We want to know that a location has good basic infrastructure – schools, shops, government services, public transport and recreation amenities.

If there is also a major factor in the market like a university campus or a hospital, this can be significant as a big generator of demand for real estate.

In addition is good existing infrastructure, one of the big game-changers we look for is major new infrastructure under construction or in planning.

A $500 million or $1 billion infrastructure project is a big generator of economic activity and employment in an area while under construction – and, with certain types of infrastructure, when completed and operational. And this means strong demand for dwellings, both to buy and to rent.

This is one of key factors that has kept many property markets across Australia busy and vibrant during times of high inflation, high interest rates and economic uncertainty.

And here’s the key factor: the level of infrastructure investment currently occurring in the nation is unprecedented, in my experience, which is more than 40 years researching and writing about real estate issues.

Projects under way or completed in 2024 across Australia totalled well over $500 billion, with another $370 billion worth in advanced stages of planning.

These projects include hospitals, universities, airports, motorways, rail links, ship-building enterprises and major energy projects like wind and solar farms.

Partly at least, the level of construction of big infrastructure developments was inspired by the economic damage caused by the Covid lockdown periods and a desire by governments to bring on big ticket projects to generate economic activity and jobs to avoid recession.

These developments can have huge impacts on property markets, because they create demand for workers and for businesses that provide products and services.

And the impacts can be long-lasting.

If a new $1 billion hospital is proposed, it may create 3,000 or 4,000 jobs in construction – but have even bigger impact after it is completed, because there are often as many as 6,000 jobs in the operation of this major facility.

I recently conducted an analysis of infrastructure investment in the capital cities and regional areas of Australia on a per capita basis – in other words, the level of spending relative to the population of the city or regional jurisdiction.

And the places with the biggest impacts from current and planned infrastructure were Darwin, Brisbane, Adelaide and Melbourne among the capital cities, and the regional areas of Queensland and South Australia.

Some of the big ticket infrastructure projects currently happening, with direct and indirect impacts on real estate markets are …

the $31 billion Inland Rail Link, which is connecting Melbourne to Brisbane via regional NSW;

the new Western Sydney airport, which includes new road and rail links, as well as education, medical and commercial precincts, totalling many tens of billions of dollars in investment; and

major new hospital developments in regional cities like Toowoomba, the Gold Coast and Bundaberg in Queensland; Wollongong and the Tweed region in NSW: Albury-Wodonga at the NSW border with Victoria; and several of our capital cities. Many of these hospital projects will each cost over $1 billion and will be massive generators of economic activity and employment, and from that demand for real estate.

It's a key factor to look for when considering good places to buy for future capital growth. A location with a big program of infrastructure developments will always have rising prices.

Owning your first home might feel like a distant dream, but the right financial habits can bring it closer than you think. In this episode of The Property Playbook, host Tim Graham sits down with Glen James—creator and host of the Money Money Money podcast and founder of the Glen James Spending Plan.

Glen shares practical tips on saving smarter, spending wisely, and investing confidently to help first-time buyers achieve their property dreams.

What You'll Learn in This Episode:

The most common financial mistakes that hold first-time buyers back and how to avoid them. Glen's top strategies for saving a deposit while balancing other financial priorities.
Practical tips for staying financially resilient in a high-interest-rate environment. Advice for singles re-entering the property market after a separation.
How the Glen James Spending Plan helps people take control of their money and get onto the property ladder.

Guest Bio:

Glen James is a retired financial adviser with over 10 years of experience. As the creator of the Glen James Spending Plan and the Money Money Money podcast, Glen is dedicated to helping people spend, save, and invest with confidence through simple, actionable advice.

Follow Glen James:

Website: https://www.moneypodcast.com.au/

Podcast: Money Money Money

Spending Plan: The Glen James Spending Plan

Follow The Property Playbook:

Website: www.hotspotting.com.au

Instagram: https://www.instagram.com/timgraham_hotspotting/

In this insightful recording, Tim Graham of Hotspotting is joined by Sam Wakefield, Director of Optalife Financial Planning, to uncover actionable strategies to turn your property portfolio into a steady income stream for retirement.

Whether you’re planning for retirement or looking to maximise your current investments, this session provides practical advice to help you achieve financial security through smart property decisions.

What You’ll Learn:

Debt Reduction Strategies: Learn how to free up cash flow by managing and reducing unnecessary debt.

Tax Minimisation Tips: Discover effective ways to keep more of your hard-earned money with clever tax planning.

Smart Selling Decisions: Understand when to hold, when to sell, and how to maximise the value of your property investments.

This recording is packed with practical insights and expert advice, offering you the confidence to take control of your property portfolio and make it work harder for your retirement.

📌 Don’t forget to subscribe to our channel for more webinars, tips, and updates on property investment insights!

👉 If you’re ready to learn more and connect with Sam and his team, please visit www.optalife.com.au

All the key indicators suggest that the Perth boom is past its peak and subsiding.

Our analysis of all the major market jurisdictions across Australia, using a range of different performance metrics, indicates that Perth will not be the leading performer on price growth in 2025 – or anything close to it.

After two consecutive years as the national leader on price growth, we feel confident in predicting that Perth is unlikely to repeat that performance in 2025.

Perth was undoubtedly the national leader on price growth in 2023. Its median house price rose 16 percent (the national average was 8.6 percent) and its median unit price increased 12 percent (national average was 6.4 percent).

In 2024 Perth repeated the performance, leading on both house prices (up 17 percent) and unit prices (up 19 percent), both more than three times national averages – but challenged in both categories by Brisbane and Adelaide.

But it was evident in the latter part of the year that the rate of growth for Perth was slowing month by month. Earlier in 2024, the annual growth rate for houses was well above 20 percent. With each passing month, the annual growth rate is smaller, although it still appears to be impressive.

And, indeed, there is a growing list of forward indicators which say Perth is on the wane.

Perhaps most significant is that sales activity has declined, even though stock on the market has risen steadily since the middle of 2024. In this regard, Perth is the weakest of the major cities and regional markets, with activity steadily waning.

Vacancy rates are also easing and rents are no longer rising rapidly. Indeed, according to the REIWA, there has been little rental growth in Perth since March 2024. With so many investor purchases in the past 2-3 years, rental supply has risen – changing the supply-demand equation.

Other sources indicate a slowdown in population growth and less demand from investors. The buyer frenzy is subsiding, which is confirmed by our conversations with real estate professionals at the coalface of the Perth market.

For those still interested in buying in the Perth market, a key trend is that more buyers are pivoting to attached dwellings.

One of the main catalysts for the Perth boom of recent years was its cheap houses, but now the city’s median house price is similar to Melbourne and Adelaide. The relative bargains are now being found in the unit market and there are a number of good options there.

But home buyers and investors considering the Perth market need to be aware that the peak of the market has passed and the stellar price growth of 2023 and 2024 is unlikely to be repeated.

If you’re confused about what’s happening with rents in Australia, you can be forgiven.

That’s especially so if you use news media as your main source of information about residential real estate.

The information – or perhaps more correctly, misinformation – in news media is highly confusing and in many cases contradictory, with one headline saying the complete opposite to another.

Here are two headlines that appeared on the same day, the 10th of January:

The worst is over: slowest rise in rents in four years

Affordability crisis: tenants feel the pinch as rents surge

So, as usual, Australian real estate consumers need to look elsewhere, somewhere other than mainstream media, to find out what’s really happening in housing markets.

One of the strange things about residential rents, which pops up regularly in news media, is the bizarre notion that if the latest stats suggest that the rate of growth in rents is slowing, then tenants across the nation are celebrating.

They’re apparently popping champagne corks because the rate of rental growth currently is less than it was last year.

Let’s be clear: the greatest wish of tenants is NOT slower growth in rents. It’s NOT for rents to stop growing. And contrary to the apparent belief of The Greens, they don’t want a rental cap. What they want is for rents to FALL.

People who rent in Australia, about a third of households, want to see a bigger choice of places to live in – in other words, they want higher vacancies. And they want rents to come down.

There are two main reasons why that isn’t happening and cannot happen:

(1) because vacancies are at historic lows, as they have been now for three years, and there are no remedies in sight; and

(2) because interest rates are persistently high and the owners of rental properties need high rents to cover their costs.

Having said that, it’s clear that - in some locations - rents have reached a ceiling and are unlikely to go much higher in the short term. Tenants cannot keep paying higher and higher rents – and higher and higher proportions of their incomes – on rental accommodation.

That is why the rate of growth in rents has slowed in SOME – but certainly not all – locations across Australia.

But the true wish among tenants – for rents to decline – is highly unlikely to happen any time soon.

SNIPPET:

There’s a lot of confusing and conflicting information in mainstream media about what’s happening with residential rents.

Some headlines have declared that the worst is over for tenants because the rate of growth in rents is slowing down – as a national average.

But other headlines have claimed that rents continue to surge higher and tenants continue to be in a world of pain.

The reality is that rents are still rising, although in SOME locations the rate of growth is slowing down.

But with vacancy rates continuing to be at historic lows in most places across Australia, and interest rates stubbornly high, we don’t have the conditions for rents to fall any time soon – particularly as there are no solutions in sight for the shortage which is causing rents to be high and rising.

If you’re confused about what’s happening with rents in Australia, you can be forgiven.

That’s especially so if you use news media as your main source of information about residential real estate.

The information – or perhaps more correctly, misinformation – in news media is highly confusing and in many cases contradictory, with one headline saying the complete opposite to another.

Here are two headlines that appeared on the same day, the 10th of January:

The worst is over: slowest rise in rents in four years

Affordability crisis: tenants feel the pinch as rents surge

So, as usual, Australian real estate consumers need to look elsewhere, somewhere other than mainstream media, to find out what’s really happening in housing markets.

One of the strange things about residential rents, which pops up regularly in news media, is the bizarre notion that if the latest stats suggest that the rate of growth in rents is slowing, then tenants across the nation are celebrating.

They’re apparently popping champagne corks because the rate of rental growth currently is less than it was last year.

Let’s be clear: the greatest wish of tenants is NOT slower growth in rents. It’s NOT for rents to stop growing. And contrary to the apparent belief of The Greens, they don’t want a rental cap. What they want is for rents to FALL.

People who rent in Australia, about a third of households, want to see a bigger choice of places to live in – in other words, they want higher vacancies. And they want rents to come down.

There are two main reasons why that isn’t happening and cannot happen:

(1) because vacancies are at historic lows, as they have been now for three years, and there are no remedies in sight; and

(2) because interest rates are persistently high and the owners of rental properties need high rents to cover their costs.

Having said that, it’s clear that - in some locations - rents have reached a ceiling and are unlikely to go much higher in the short term. Tenants cannot keep paying higher and higher rents – and higher and higher proportions of their incomes – on rental accommodation.

That is why the rate of growth in rents has slowed in SOME – but certainly not all – locations across Australia.

But the true wish among tenants – for rents to decline – is highly unlikely to happen any time soon.

SNIPPET:

There’s a lot of confusing and conflicting information in mainstream media about what’s happening with residential rents.

Some headlines have declared that the worst is over for tenants because the rate of growth in rents is slowing down – as a national average.

But other headlines have claimed that rents continue to surge higher and tenants continue to be in a world of pain.

The reality is that rents are still rising, although in SOME locations the rate of growth is slowing down.

But with vacancy rates continuing to be at historic lows in most places across Australia, and interest rates stubbornly high, we don’t have the conditions for rents to fall any time soon – particularly as there are no solutions in sight for the shortage which is causing rents to be high and rising.

The Prime Minister is suffering from a serious case of denial if he believes that his press conference soundbite about building 1.2 million new homes is plausible, credible and achievable.

Anthony Albanese had his big media event in August 2023 when he stated this objective of 1.2 million new homes in five years – but almost 18 months later it’s abundantly clear to everyone except members of the government that it’s not going to happen – indeed, was NEVER going to happen.

It’s almost as if the PM and his cohorts believed that staging the publicity event in 2023 was all they needed to do - make the announcement of a target which has never been achieved in the nation’s history and then sit back and watch it happen. Job done.

Here we are in 2025 and all the official data shows that building approvals - and in particular building commencements - are so far behind the levels needed to reach the target, that it can already be dismissed as fanciful – indeed, almost childlike in its naivety and idealistic stupidity.

In the past 12 months building approvals totalled around 170,000 – but approvals don’t always translate into actual construction, particularly right now with all the problems in the home building industry.

So we are so far short of where Australian needs to be to meet the target that there is really no realistic hope of achieving it.

And it’s noteworthy that the original target date was mid-2029 and now, quietly, hoping that no one notices the Federal Government has moved the target date to 2030.

But when challenged by journalists about the stark lack of results, the PM becomes angry and defensive – as he has done at recent press conferences.

The Federal Government appears to think that the industry should just go out and build the homes because the Government says they should – and is oblivious to the long list of serious problems which are preventing it from happening.

Building companies are going broke at the rate of nine per day and that is happening for a reason – but you have to wonder if the Federal Government is even aware of this reality.

The cost of building new houses and in particular new apartments has become so high, so catastrophically high, that in many instances it’s not economically feasible to build them because the average buyer won’t pay the increasingly high price for new dwellings.

Is the PM remotely aware of that?

To build homes you need a healthy supply of tradespeople – but the industry has a chronic shortage and needs tens of thousands more to be able to create the dwellings needed – and there aren’t enough apprentices coming into the industry.

One of the reasons the home building industry can’t find the tradies it needs – and why the ones that exist are increasingly expensive – is because federal and state governments have initiated record levels of investment in infrastructure – and there were over $500 billion in projects happening in 2024 and more to come this year and beyond.

This has removed tens of thousands of tradies from home building - to work on the more lucrative headline projects initiated by politicians facing looming elections.

Is the Prime Minister aware of that? Because it’s one of the key reasons his media soundbite home-building target will not be achieved.

Does Anthony Albanese know that the average time it takes to build a house or an apartment has blown out enormously in recent years, thanks to bureaucracy and political interference in the process?

That the cost of building has escalated enormously because of new rules imposed by the various levels of government?

And those factors, plus persistently high interest rates, are the key issues that are sending building businesses broke at the rate of nine per day.

Australia has never created 1.2 million new homes in any five-year period in history and it won’t be happening in the five years following the August 2023 publicity stunt by the Prime Minister.

Sadly, Anthony Albanese is in denial about it, so the problems are unlikely to be fixed.

SNIPPET:

The Prime Minister is in denial if he believes that his press conference soundbite about building 1.2 million new homes is plausible, credible and achievable.

Anthony Albanese had his big media event in August 2023 when he stated this objective of 1.2 million new homes in five years – but almost 18 months later it’s abundantly clear to everyone - except members of the government - that it’s not going to happen – indeed, was NEVER going to happen.

Here we are in 2025 and all the official data shows that building approvals - and in particular building commencements - are so far behind the levels needed to reach the target, that it can already be dismissed as fanciful.

And it’s noteworthy that the original target date was mid-2029 and now, quietly, hoping that no one notices, the Federal Government has moved the target date to 2030.

But when challenged by journalists about the stark lack of results, the PM becomes angry and defensive – as he has done at recent press conferences.

Let’s be clear: Australia has never created 1.2 million new dwellings at any time in its history and it’s not going to happen in this five-year period – so the shortage will persist well into the future.

Two very different headlines have summed up the problems for Australia’s ongoing housing shortage.

One of the recent media headlines declared that building approvals were at a two-year high and that things were improving for the nation’s housing shortage.

The other described why building approvals are almost irrelevant – it said that project deferrals are occurring at a record rate.

The reality of the current crisis is this: it doesn’t matter how many houses and apartments are approved for construction – and it doesn’t matter how many re-zonings state governments push through or what incentives they hand out to first-home buyers.

Most real estate developments are not proceeding because they’re not financially viable.

One of those media headlines read: Building approvals hit two-year high as apartment construction surges.

This was incorrect - apartment construction is not surging – approvals are, but many projects are simply not being built because they’re not viable in the current environment.

It’s so expensive to build that the end price for the dwellings would be far too high for most buyers – and therefore not financially feasible.

In October, Australian dwelling approvals reached their highest level in 22 months - with nearly 15,000 new homes approved for construction during the month.

ABS data showed total dwelling approvals rose 4.2 per cent for the month, with approvals for apartments and townhouses jumping 25 per cent to over 5,800 units, the highest since May 2023 – but private house approvals fell 5.2 per cent.

The AFR showed a startling lack of understanding of the problems in the industry when it declared in a headline: Worst has passed for new home building

The article said: “The worst has passed for Australia’s medium- and high-rise housing sector, economists said on Monday, after a jump in approvals of new apartments, townhouses and semi-detached homes.”

KPMG urban economist Terry Rawnsley said:

“The bad times are starting to end … Even with interest rates being unchanged for the year, they still have that confidence that if they can get a project out of the ground they’ll be able to sell it at a profit.”

But that, we think, was rather naïve – and others were less optimistic.

The Property Council of Australia pointed out that apartment approvals were still at half their level of the development boom under way in FY2018.

And Oxford Economics Australia senior economist Maree Kilroy said: “While the latest approval result for apartments was positive, we continue to expect a materially higher dropout rate to commencement.”

In other words, many approvals would not translate into construction. She referred to utility connection bottlenecks and trade labour shortages as problems in the sector.

Matthew Kandelaars of the Property Council said:

“We need to get back to the construction levels seen nearly 10 years ago. We are now six months into the National Housing Accord’s ambitious target of delivering 1.2 million new homes and we cannot allow the target to slowly fade into the background over the next 4½ years.”

According to a new report, money is still flowing into the construction industry but more and more of it is being dedicated to renovating.

KPMG released analysis of spending in the residential construction sector, revealing that while spending on renovations has boomed over the past five years, new residential construction on a per-capita basis has hit a low not seen since 1988.

Over the past five years, spending on new home building has dropped 14 per cent, adjusted for inflation. By comparison, the amount of funding flowing into renovations has increased by 6.5 per cent.

KPMG said:

“For every nail hammered and brick laid in residential construction, 40 per cent of it is going into renovating a pre-existing home.”

So the underlying problem remains. Regardless of how many dwellings are approved, far too few are proceeding to construction – so the fundamental shortage continues and there will continue to be upward pressure on prices and rents.

In this insightful webinar, Terry Ryder, founder of Hotspotting, and Tim Graham, Hotspotting’s General Manager, analyze the surprises and trends of 2024 in the Australian property market and share their projections for 2025. With decades of combined experience, they provide investors with actionable advice on navigating the coming year.

Key Highlights 2024 in Review * Defying Predictions: Despite high interest rates and inflationary pressures, property prices rose by an average of 5.53% nationally in 2024. Perth led with an astonishing 18.7% growth, followed by regional Western Australia, Adelaide, and Brisbane. * Surprise Winners: Hotspotting’s 2024 National Best Buys Report proved remarkably accurate, with 9 out of 10 selected locations achieving growth three times the national average. * Shift to Apartments: Demand for attached dwellings surged, driven by affordability and lifestyle preferences, with some unit markets outperforming houses in capital growth.

2025 Projections * Second Wind Markets: Regions like the Sunshine Coast, Albury-Wodonga, and Ballarat are emerging from a "pause phase" and are primed for growth, fueled by rising sales volumes and infrastructure developments. * Avoid Frenzied Markets: Perth, Adelaide, and regional Queensland hotspots like Townsville are reaching their peaks. Investors should seek opportunities in undervalued markets with long-term growth potential. * Surprising Contenders: Cities like Darwin and Launceston, as well as regional Victorian areas, are poised for unexpected growth, offering affordability and strong rental yields.

Emerging Trends * Affordability Focus: High interest rates are amplifying the appeal of regions with lower entry prices and strong rental yields. * Infrastructure Impact: Areas benefiting from large-scale projects, such as Toowoomba and inland rail hubs, continue to attract growth. * Changing Investor Mindsets: Long-term strategies and careful market selection are replacing speculative approaches.

Special Offers * National Top 10 Best Buys Report: Just $249. * Best of the Best Bundle: Three premium reports for $399 (save $200). * Exclusive Property Course: Register now for early bird discounts on Hotspotting’s comprehensive new property investment course launching in 2025.

Special Offers

National Top 10 Best Buys Report: Just $249.

https://www.hotspotting.com.au/product/national-top-10-best-buys/

Best of the Best Bundle: Three premium reports for $399 (save $198). https://www.hotspotting.com.au/product/best-of-the-best-bundle/

Exclusive Property Course: Register now for early bird discounts on Hotspotting’s comprehensive new property investment course launching in 2025.

Register your interest for early-bird specials: https://lwdt7n6k0ij.typeform.com/to/MHVUya51

You don’t have to be super rich or invest $1 million to make big capital gains in residential real estate: you just need to follow Hotspotting’s signature report, the National Top 10 Best Buys report.

Those who followed the tips in our report of a year ago could have made close to $100,000 in capital gains spending as little as $400,000 – or $180,000 in gains after investing $630,000.

In December 2023 we published our National Top Best Buys reports for Summer 2023-34. Our top 10 locations for investors to consider covered a wide range of price points, from less than $300,000 and above $1 million.

And all 10 regions suggested in that report a year ago include suburbs which have delivered spectacular gains in the past 12 months. Many rose by more than 20% in 12 months, compared with the national average rise of just 5.5%.

In Bunbury in Western Australia, you would have paid below $350,000 for the typical house in suburbs like Carey Park and Withers – and seen your investment grow by $90,000 or more, following annual growth between 25% to 30%.

Even a modest investment of less than $300,000 for a small unit in Carlton in inner-city Melbourne would have shown excellent capital growth, out-performing the generally flat Melbourne market.

Those with more to spend late in 2023 could have achieved over $200,000 in capital growth by buying houses at the median price in locations such as Punchbowl in Sydney and Carrara on the Gold Coast, or apartments in Elizabeth Bay in Sydney.

More mid-range were units in Kangaroo Point in Brisbane or at Runaway Bay on the Gold Coast; and houses in Tea Tree Gully in Adelaide or Fairy Meadow in Wollongong – all delivering $100,000 or more in gains for those who bought around the median price for those locations.

The average situation arising out of our National Top 10 Best Buys report a year ago was investing $640,000 and achieving a 21% rise in value, which means capital gains of $146,000.

We’ve recently published our National Top 10 Best Buys report with our selections to launch 2025.

And, in keeping with our tradition of seeking to identify the future hotspots – which means locations with potential for strong price growth, but before those markets rise strongly and become competitive – the new edition of Best Buys does not include already hot markets like Perth, Adelaide and key regional markets in Queensland.

We’ve identified places where you can buy sensibly, with due diligence, and look forward to excellent capital growth over time.

The greatest complaint heard most often in real estate across Australia is that there are plenty of buyers, but a shortage of listings.

The number of properties for sale has been well short of the levels needed for a balanced market, particularly in the boom cities of Adelaide, Brisbane and Perth.

But that is steadily changing. According to SQM Research, total listings of properties for sale nationwide grew 7.6% in November and are now more than 10% higher than a year ago.

Perhaps most significantly, there were major rises in November in those three boom cities, with the number of listings up 20% in Perth and close to 17% in Adelaide, with Brisbane recording a rise of 8.6%.

That follows significant increases in October also.

The rise in listings nationally in November was driven by a 6.4% rise in old listings (stock on market over 180 days) and a notable 22% rise in properties being on the market between 30 to 90 days.

SQM Research commented that this strongly indicated that the spring selling season had been a disappointing period for vendors and agents.

Cities with significant annual increases in listings included Sydney, Melbourne and Hobart – all up 16 to 17 per cent – and Canberra, up 23% in annual terms.

Comparing the current situation with recent history, national listings of properties for sale are still below the levels common before 2021, but have been generally rising since July.

In Sydney, listings are the highest they’ve been since 2019 and in Melbourne they’re the highest since November 2020. In Canberra they’re close to the peak levels of 2019.

In Perth, Brisbane and Adelaide they’re still well below historic levels but have been rising steadily since mid-2024, with particularly large increases in November.

The rise in the number of properties for sale coincides with evidence that the rate of price growth is reducing in those market-leading cities.

The big exception in all this is Darwin, the only capital city to record a reduction in the number of listings in November – and it remains 17% below the levels of a year ago.

The figures provide further evidence of change in individual markets, with a growing number of indictors that the Perth boom has passed its peak and that there may be stronger price performance in places like Darwin in 2025.

Things are constantly changing in real estate nationwide but the one factor that never changes is this:

we can always rely on news media to distort the facts and deliver a steady flow of misinformation to Australian consumers, all in the interests of attracting readership, with little regard for accuracy, honesty or fairness.

The past week or so has been chockful of media nonsense.

If you can believe the headlines, the national property boom is over, house prices are plunging, the rental boom is over and the North Queensland city of Townsville is a mining town.

One of the constants of my 40-plus years charting Australian real estate is that there are lines and lines of idiots scrambling to be the first to declare that a boom is over, usually long before it actually is.

This is often fed by data research entities like CoreLogic where the key people never let the facts get in the way of good headline and free publicity.

So Australia has been resplendent lately with strident headlines declaring that the national property boom is over or words to that effect.

Here’s the first problem: we don’t have a national property boom so it’s rather odd to declare that something which doesn’t exist is finished.

We have certainly had a boom in Perth, Adelaide and Brisbane among the capital cities, but certainly nothing remotely resembling a boom in the other five state and territory capitals.

It’s a similar scenario in the regional markets, with a variety of different situations ranging from downturn and stagnation to moderate growth and, in some cases, strongly rising prices.

But nationally growth in house and unit prices has averaged 6 or 7 percent throughout 2024 – and lately the annual growth rate, as a national average, has been 4 or 5 percent. Only in the fertile imaginations of media headline writers would that constitute a boom.

But, according to various media outlets, this mythical boom is over – even though the latest figures for annual growth in three of our capital cities and three of our state regional markets are still well above 10%.

The only places where the evidence suggests the boom is over are the ones where a boom never took place – like Melbourne, Hobart, Darwin and Canberra.

But not only, according to media, is the fictional national boom over, but property prices are plunging. One headline in Fairfax media claimed to reveal Why property prices are plunging across Australia – amid warning they could slide even further.

A close examination of the article underneath this startling headline discovered there was no evidence in the story to justify the headline. Quite simply, the headline was a blatant fabrication – which, sadly, is all too common in today’s news media.

The article revealed that Sydney’s median price was 0.8% lower than three months earlier but 3.3% higher than a year earlier, while Melbourne was down 1% over three months. Nothing in those figures goes even close to “prices plunging”.

In the other major cities prices were still rising and indeed were still growing at boom time rates.

House prices were also up in the Combined Regions in the latest month, the latest quarter and the past year– and unit prices were also up nationally, both in the cities and the regions.

So, there was very little sign of even minor decline in prices anywhere and certainly no evidence at all of price plunging.

So this was yet another instance of a headline which was an outright and blatant lie.

And who wrote this rubbish? well, it was the champion of negative media about residential real estate, the endlessly sad Shane Wright who has devoted his career to writing nonsense about property markets.

But wait, there’s more. Not only is the fictional national price boom over, but apparently the rental boom is over as well!

There have been strident headlines and soundbites inferring that rents are no longer rising.

As is so often the case with these big sweeping media statements, the claim was based on a single month’s figures from one source. Nationally, rents rose only 0.2% in November, according to CoreLogic, therefore the boom is over in the simplistic minds of attention-seeking analysts and journalists.

And, yes, once again, the source of this myopic and shallow analysis is CoreLogic, a business which publishes lots of major real estate data but is quite dreadful at analysing what it all means.

So CoreLogic’s head of research Tim Lawless said:

“At 5.3% annual growth, rents are still rising at more than twice the pre-pandemic decade average of 2.0%, but given the weak monthly change the annual trend is set to slow further from here.

“It will be interesting to see if the rate of rental growth rebounds through the seasonally strong first quarter of the year in 2025, but beyond any seasonality, it looks increasingly like the rental boom is over”.

But other sources tell a different story. SQM Research records a monthly rise of a tick under 1% as the national average for residential rents, with Adelaide up 1.1%, Perth rising 1.9% and Canberra up 1.5%.

The national vacancy rate remains a fraction above 1%, essentially unchanged from three years ago, so can anyone justify a claim that the rental shortage crisis and rising rents is all done and dusted? Hardly.

Another startling set of headlines resulted from the latest Regional Market Update from CoreLogic which declared that the highest capital growth was occurring in Queensland and WA mining towns.

I was truly perplexed because I know there has been little price growth recently in mining towns like Karratha, Port Hedland and Newman in WA and Moranbah in Queensland.

However, the headlines resulted from CoreLogic boffins – yes, it’s CoreLogic again - re-defining major regional cities as mining towns.

Apparently Townsville, which has one of the most diverse economies in regional Australia, with only minor influence from the resources sector, is now a mining town.

So is the key Central Queensland of Mackay, apparently, despite being 2-3 hours’ drive from the nearest coal mine.

In WA, the key regional city of Geraldton is also, apparently, a mining town, according to Core illogic, although the nearest iron ore mine is an hour’s drive away.

All of this, and a whole lot more, reinforces our view that there is more misinformation than actual information in mainstream media.

And that any real estate consumer who bases a decision on the content of media reports is at risk of making a very bad decision.

Rumours of the death of ‘the national property boom’ are greatly exaggerated – especially since we didn’t have a national property boom in 2024. Rather, over the past 12 months, we have seen differing market cycles in many locations - as is the usual state of play in real estate throughout Australia. Strong property price growth was recorded in Perth, Adelaide, and Brisbane in 2024, but not in Melbourne, Sydney, Canberra, Darwin or Hobart.

Similarly, in the regional areas, there were declining and stagnating markets, as well as some where prices were showing good price growth.

This is situation normal in Australian real estate. It’s a big country and real estate markets are very local in nature.

So, a national property boom? We haven’t had one. So you ignore headlines declaring that the national property boom is over.

So, what can we expect in residential real estate in 2025? Firstly, the major bank economists will predict price declines in 2025 – as they did at the start of 2023 and again at the start of 2024 - and will be proven wrong yet again because it they fail to understand the basic dynamics that drive prices in residential real estate. Politicians will continue to scapegoat their traditional targets of foreigners (migrants, international students and foreign investors) as well as mum-and-dad Australian investors – and enlist the help of shallow journalists to infer that these cohorts are the cause of all the problems in the housing markets.

The reality is that investors, local and foreign, are not the problem – they are the solution. They hold the keys to solving the housing crisis.

Meanwhile, most State Governments will continue to make the housing crisis worse with anti-investor policies - with the negative ramifications of recent rental reforms to become more apparent as 2025 unfolds. Vacancy rates will remain low, but the rate of rental growth generally will slow because markets have hit a ceiling due to limits in the capacity of tenants to pay more.

However, restrictive rental legislation by various state and territory governments will continue to motivate some investors to sell up – thereby making the rental shortage worse. The Greens will continue to embarrass themselves and lose voter support with anti-investor rants, with the Federal Election due early in the year likely to see their influence reduce even more.

Investors will continue to pile into the frenzied markets, mostly in regional Queensland -however, the smart money will target locations early in the growth cycle, not at the end. Evidence that the Perth market has passed its peak will become more apparent with a similar slowdown forecast for regional WA. The solid economic and market fundamentals in Adelaide means it will continue to show solid growth next year as well as Brisbane and regional Queensland.

Melbourne did not have a good year in 2023 or in 2024, but I believe it will start to rise next year, thanks to the price differential with Sydney and its high population growth. This will occur despite Melbourne having the worst state government and the highest taxes in the nation. Darwin will be targeted by investors and will begin to show some price growth next year, too. More and more indicators are favourable for the Northern Territory capital, with investors seeking its affordable houses and high rental yields. The Exodus to Affordable Lifestyle will continue, boosting many regional markets, as more big city residents seek a different and more affordable way of living, enabled by technology and the ability to work remotely. What we have termed the ‘second-wind markets’ will ignite.

These are locations where the market sprinted (with major price growth) from 2022 to 2024, has been catching it breath since then, and now, having got its second wind, is starting to run again.

They include regional cities such as Albury-Wodonga and Tamworth in NSW, the Sunshine Coast and Hervey Bay in Queensland, Bendigo and Ballarat in Victoria, as well as Launceston and Burnie in Tasmania.

There will continue to be a lot of conjecture about interest rates next year, but the potential impact of any rate reductions will be largely irrelevant and greatly over-rated by many economists and news media.

As we’ve learned from the past two years, trends with interest rates are not the major influence on real estate outcomes.

If they were, prices would have fallen everywhere over the past two years.

And that, clearly, has not been the case.

Victoria’s real estate market is witnessing a significant shift as young first-home buyers increasingly seek affordable housing in regional areas.

According to recent data from the Australian Bureau of Statistics (ABS), first-home buyer loans in Victoria soared to 4,202 in July – the highest number in nearly two years.

This surge reflects growing confidence among young buyers and a trend towards exploring housing options beyond Melbourne.

Nationally, the Commonwealth Bank of Australia and the Regional Australia Institute report that the flow of people from cities to regional areas is now 16 per cent above pre-pandemic levels.

The Regional Movers Index indicates a 27 per cent increase in people moving from cities to regional areas compared to those moving in the opposite direction during the June quarter.

Over the past year, 11.2 per cent of movers have relocated from cities to regions, with three-quarters settling in Victoria or NSW, up from half of all movers last year.

Government incentives such as the First Home Owner Grant and stamp duty exemptions are boosting this trend.

Regional Victoria hotspots such as Ballarat, Bendigo and Geelong are seeing heightened interest from first-home buyers eager to take advantage of lower property prices. Greater Geelong, in particular, has emerged as the most sought-after regional LGA in Victoria.

And this affordability attraction has equal appeal to property investors.

In contrast to Melbourne’s median house price of more than $900,000, regional Victoria offers numerous more affordable options.

Geelong’s median house price is $720,000, while Ballarat and Bendigo are even more budget-friendly at $550,000 and $490,000. This affordability makes ownership accessible for buyers who might be priced out of Melbourne’s market.

The work-from-home trend, enabled by technology and accelerated by the pandemic, has also contributed to this shift.

Many Victorians now have the flexibility to work remotely, making it feasible to live in regional areas while maintaining their careers. This flexibility enables buyers to enjoy a better lifestyle balance without sacrificing their job connections in Melbourne.

For investors considering buying in Regional Victoria, and concerned that prices have not increased recently, it’s worth remembering that longer term Victoria has an exceptional track record on capital growth.

Regional Victoria ranked fifth in the nation in the recent PIPA research into where the best capital growth has occurred in the past 20 years – ahead of Perth, Sydney, Melbourne, Canberra and the regional markets of NSW, Queensland and Western Australia.

According to the PIPA research, home values in Regional Victoria grew 187% over the past two decades.

Another factor in favour of investors is that Victoria’s rental market is shrinking, which means there are fewer vacant properties.

New data from Victoria’s Department of Families, Fairness and Housing reveals a sharp contraction in the state’s rental market, with active rental bonds dropping by 21,712 in the year to June 2024.

This marks the first decline in recorded history since 1999, representing a significant shift in market dynamics.

PropTrack has attributed much of the contraction to Victoria’s rising property taxes, stricter rental standards and sustained high interest rates, which has made rental property ownership less attractive and more expensive for landlords.

While around 50,000 new loans were made to investors during the 2024 financial year, PropTrack noted that the influx was insufficient to offset the exodus, leading to a net loss of rental properties.

The data also indicated that the churn rate for sales by investors was significantly higher than a typical year, further intensifying the decline.

While there are clear reasons why investors have been deterred from investing in Victoria, the trends present opportunities for investors who are interested in Regional Victoria’s long-term growth record, its relative affordability and the growing shortage of rental properties.

Hotspotting was among the first to identify and highlight the most significant change in the Australian real estate scene – the emerging trend which we document in the quarterly editions of the report titled The Rise and Rise of Apartments., published in association with Nuestar.

This trend has turned upside down the dominant paradigm in real estate, that houses out-perform apartments on capital growth. There is now growing evidence that attached dwellings are mounting a strong challenge to houses.

It has long been believed that land content was the big thing in driving property values and that units lacked this quality.

Increasingly, it’s clear that this theory about capital growth needs to be re-considered and to acknowledge that attached dwellings like apartments have qualities that houses don’t have and which are important to growing numbers of buyers.

The latest Housing Affordability Report, jointly released by CoreLogic and ANZ, has

observed that capital city unit prices increased more over the three months to October 2024, than did house prices over the same period, suggesting a growing preference among home-buyers and investors for units as an affordable option in getting into the market.

The growth difference was small, but it’s merely the latest in a growing set of figures showing the rising performance of units.

In the month of October, the median price growth for units was higher than for houses in the nation’s five biggest cities and also for the combined regions.

This was also the case for the October quarter.

In annual terms, price growth has been better for units than houses in the three capital cities leading the nation on market growth – Brisbane, Adelaide and Perth. Units have also out-performed in the regional markets of Queensland, WA, NSW and Victoria.

The annual growth in median unit prices, according to CoreLogic, has been 18% in Adelaide, 19% in Brisbane and 24% in Perth. Those are spectacular increases and provide compelling evidence to disprove the notion that attached dwellings don’t perform on capital growth.

There are also growing numbers of suburbs around Australia where unit price growth is higher, both in the short-term and the long-term.

The Hotspotting Research Hub shows that at Noosa Heads on the Sunshine Coast, the five-year growth average is 10% per year for houses and 17% per year for units. At Surfers Paradise on the Gold Coast, it’s 8% per year for houses and 12% per year for units.

There are many other similar examples across the nation.

REA Group, which publishes realestate.com.au, has recently highlighted locations where unit price growth is outpacing houses.

Megan Lieu, Economic Analyst at REA Group, says:

“Historically, house values have risen at a faster rate than units, but with affordability pressures, units are being preferred by many homebuyers.”

“In certain suburbs,” she says, “unit prices have grown at more than double the rate of houses over the past year.”

Searches for units on realestate.com.au have also been trending upwards since mid 2020. They now make up close to 40% of all buy searches on-site.

Lieu says that, while the strong performance of units has been evident nationwide, there are areas where demand for units has been particularly high, resulting in significant price increases compared to houses.

In New South Wales, for example, the annual growth in unit values in Engadine, Wagga Wagga and Merimbula has outpaced houses by around 6 percentage points.

In Victorian, Safety Beach, Templestowe Lower and Warragul are examples of locations which have experienced stronger growth in their values compared to houses by considerable margins.

The largest difference in value growth between units and houses in Queensland was observed in the Brisbane suburbs of Waterford, Nundah and Waterford West. Units in Waterford and Waterford West increased at more than twice the percentage of houses in these suburbs in the past 12 months.

PropTrack says that, with housing affordability at its lowest level in three decades, it's to be expected that people are turning to more economical options, especially in suburbs where the gap between house and unit values is significant.

But Hotspotting analysis shows that affordability is NOT the only reason that demand for units is rising. More buyers are choosing attached dwellings for location, for lifestyle and also for safety and security at a time of growing concerns about escalating crime levels.

For all those reasons, each quarter Hotspotting publishes a national report titled The Rise and Rise of Apartments, in association with the leading real estate marketing company Nuestar.

And it proves, emphatically, the units are now a strong option for buyers seeking not only affordability, but strong capital growth as well.

Thinking of buying property on your own?

🏡 In this episode of The Property Playbook, host Terry Ryder is joined by Chris Graham, Senior Property Advisor at Australian Hotspot Advocacy, to explore why engaging a buyer’s agent could be the key to securing your next winning investment.

What You'll Learn:

What a buyer’s agent does and how they work exclusively for the buyer’s interests.
The value of off-market properties and how buyer’s agents can provide access.
Why having a professional on your team ensures due diligence and avoids costly mistakes.
How to identify a trustworthy buyer’s agent with the right credentials.
The benefits of flat-fee models versus commission-based services.
Real-life success stories, including securing properties below market value with built-in equity.

Highlights:

[00:51] The role of a buyer’s agent and why it’s better than going solo.
[02:39] Success story: Securing a $55,000 equity gain on an off-market property.
[04:17] How buyer’s agents help clients avoid risky purchases and protect investments.
[06:33] The cost structures of buyer’s agents: Flat-fee vs. commission-based models.
[08:28] Off-market properties: What they are and why they’re a hidden gem for investors.

Whether you’re a first-time buyer or a seasoned investor, this episode will open your eyes to the strategic advantages of working with a buyer’s agent to build wealth through property.

If you would like to connect with Chris, you can reach him at chris@australianhotspotadvocacy.com.au

Melbourne’s property market remains the great under-achiever of the nation but that may be about to change.

A number of key indicators suggest better performance by the Melbourne property market is imminent.

One pointer to better times is the latest Property Sentiment survey by API magazine, which recorded a major turnaround in investor attitudes towards the Victorian property market.

The survey asked: Which state or territory do you regard as having the best property investment prospects for the next 12 months?

Mid-year Melbourne and Victoria attracted only 8.6 per cent of respondents who felt it was the best state for property investment.

Three months later in the new survey there was a remarkable turnaround, with 25 per cent identifying Victoria as having the best property investment prospects for the next 12 months.

This ranked Victoria No.2 - above New South Wales and Western Australia, and close behind Queensland in the investment popularity stakes.

One of the attractions of Melbourne is its relative affordability, thanks for the absence of price growth in the past two years.

The latest Home Price Index from PropTrack shows that Melbourne is currently cheaper than Canberra and Brisbane, as well as being well behind Sydney. Melbourne’s median dwelling price is on a par with Adelaide and Perth now.

Sydney’s median dwelling price is $1.1 million, compared to $790,000 in Melbourne.

There is a growing perception that Melbourne is now affordable and poised for capital growth that would return it to its more familiar spot sitting a little ehind Sydney as the country’s priciest market.

Indeed, the latest PropTrack price report notes recent evidence of a turnaround for Melbourne. It says:

“Price falls have started to reverse in Melbourne, with buyers out in force for the peak of spring selling season. Prices rose 0.5% in October, the highest monthly growth rate among the capital cities.”

Other factors suggesting that Melbourne is due for a period of stronger property market performance include population growth (fuelled by overseas migrants and international students), a solid economy and a significant program of major infrastructure developments.

The latest edition of the State of the States report from CommSec ranked Victoria No.4 among the state and territory economies, ahead of NSW, the ACT, Tasmania and the Northern Territory. The report said the greatest strength of the Victoria economy is the level of construction work.

The latest population data from the ABS shows Victoria had the second highest growth rate among the states and territories in the year to March 2024, rising 2.7% compared to the national average of 2.3% - and bettered only by Western Australia.

In raw numbers, Victoria added more to its population than any other state, ahead of NSW and Queensland.

Jacob Caine, President of the REIV, says Victoria has always been an attractive destination for overseas and interstate migration.

Caine says: “Melbourne’s reputation as one of the most liveable cities is well deserved.

“We have a growing population and growing demand for rental properties with new residents more likely to rent before buying.

“The challenge in Victoria is a lack of housing supply, and the need for Government to build a stronger policy platform that will attract new property investors to meet the needs of the market.”

One positive policy from the State Government is the recent announcement that the stamp duty concession for off-the-plan properties in Victoria has been extended to investors - and the price cap removed for home buyers, albeit temporarily.

This has been largely welcomed by the sector, as offering a much-needed boost to development.

New data from off-the-plan property portal, urban.com.au, has shown a “massive spike in interest” for Victorian off-the-plan projects after the concession’s announcement, reporting an immediate 123 per cent increase in direct online enquiries, and a fivefold increase in online traffic volume.

Another factor in favour of investors is the reduction is the number of rental properties available, putting upward pressure on residential rents.

For the first time since records began in 1999, Victoria’s active rental bonds dropped significantly over the 12 months to June 2024, signalling a significant shift in the state’s rental market.

There are now 22,000 fewer rental properties in the market than a year ago.

Victoria’s high property taxes and stricter rental property standards have made owning investment properties less attractive. These factors, combined with sustained higher interest rates, have driven many landlords to sell off their properties.

Melbourne’s metro areas have experienced the largest declines, with more than 20,000 fewer rental properties, a 3.7% year-on-year decrease. Regional Victoria saw a smaller drop of around 1,000 properties.

Every Melbourne LGA saw rents rise in the past year, with some regions experiencing increases of nearly 20%. Overall, rents are (on average) 7.5% higher than a year ago, creating affordability challenges for tenants.

Another positive for the state is that Victoria currently leads the nation in first-home buyer activity, accounting for 32% of new loans.

Victoria’s population is projected to grow significantly over the next five years, further increasing demand for rental properties. The shrinking rental market, combined with rising construction costs and fewer new developments, could exacerbate housing affordability issues for both renters and buyers.

The Australian Financial Review reported earlier this month that “Melbourne’s housing market could outperform Sydney and other capital cities once it emerges from its current downturn, boosted by a marked improvement in affordability after years of weak growth”.

Nicola Powell, Domain’s chief of research and economics, says: “In the next cycle, we’re likely to see Melbourne overperform because it has underperformed significantly compared to other capital cities since March 2020.”

AMP capital’s chief economist Shane Oliver says he expects Melbourne prices to grow more than Sydney’s in the next upswing.

Oliver says: “Melbourne’s been lagging for some time, but this has made the property market relatively cheap compared to Sydney and the other cities. Because of its relative underperformance, it could bounce back a little bit quicker and sharper.”

At Hotspotting, our assessment is that many of the key parameters and indicators are lining up to boost the growth prospects for Melbourne and Regional Victoria in 2025. The city and the state generally are overdue for a period of price growth.

I have frequently highlighted the poor track record of economists in predicting outcomes in real estate markets across Australia – and in particular the embarrassingly bad record of economists working for the Big 4 banks and for other major institutions like AMP Capital.

Their forecasts for house prices at the beginning of each of the past five years have been so far off the mark, it’s puzzling that the big-name economists who made these blunders have kept their jobs.

Because what these outcomes mean is that these boffins have a very poor understanding of residential real estate – and that, after all, is a significant part of what they are paid their fat salaries to be good at.

The most puzzling thing is that there’s a clear and obvious reason they always get it wrong – they think that the major determinant of house prices is what’s happening with interest rates.

Big bank economists cling to their pet theory that if interest rates are high and /or rising, prices will fall. And if interest rates are low and /or falling, house prices will rise.

In the mindset of these over-rated and over-paid bureaucrats, nothing else is in play. Not economic growth, not government stimulus, not population trends, not major infrastructure investment, not basic supply and demand factors, nor new and emerging trends like the Exodus to Affordable Lifestyle or the Rise and Rise of Apartments.

For them, it’s just interest rates. I know primary school kids with a more sophisticated understanding of real estate dynamics.

If the bank boffins were worth their salaries they would have noticed what happened with national property prices in 2023 and again in 2024, in both cases years of solid growth, in defiance of their forecasts that prices would crash because interest were rising or persistently high.

But beyond recent history, a quick study of past decades shows that their theory about interest rates and property prices is a false and failed philosophy.

Throughout the past 40-50 years, property markets in Australia have pretty much done the opposite to what the modern economist mindset suggests SHOULD happen.

The highest interest rates in my lifetime occurred in the 1980s. Throughout that decade mortgage rates were commonly above 10% and went as high as 17-18% towards the end of the period.

And yet some of the biggest property price growth in the nation’s history occurred during that period of insanely high mortgage rates – with the capital city median dwelling price rising 141% - from $59,000 in 1980 to $142,000 in 1990.

The growth in the second half of that decade, when interest rates were at their highest, was 75% - with the median dwelling price lifting from $81,000 to $142,000.

Interest rates were much lower during the 1990s, but dwelling values grew at a much slower rate in that decade, rising just 46%. So, to repeat, prices grew 141% in the 1980s with record high interest rates (up to 18%), but grew only 46% in the 1990s with interest rates much lower, down as low at 7%.

The early part of this century was another period of rising interest rates, but price growth picked up – rising 114% from 2000 to 2010.

Interest rates were considerably lower between 2010 and 2020, but the rate of price growth slowed significantly, compared to the previous decade when mortgage rates were higher.

The median dwelling price rose only 20% between 2010 and 2015, and just 23% between 2015 and 2020, despite mortgage rates getting down to around 3%.

Since 2020, we’ve seen dwelling prices grow much faster – up 36% overall in four years, despite the recent period of high and rising interest rates.

It’s pretty clear, isn’t it – so clear, in fact, that even a bank economist could understand it. Since 1980, dwelling prices have done the opposite to what bank economists say they should do – they have risen most strongly when mortgage rates have been high and the price growth has been weakest when interest rates have been low.

There have been one or two exceptions and aberrations along the way, including in 2021 when we experienced high price growth at a time of low interest rates, but that was generated by a host of other major influences, including government stimulus measures.

Beyond that, what the data tells us again and again, is that we’re more likely to have rising property prices when interest rates are high and rising.

And, when you think it through, it makes perfect sense – we get rising interest rates when the economy is strong, unemployment is low and consumers are spending – in other words, the sort of circumstances when people are more likely to be out buying real estate.

For the record, how much have Australian dwelling prices grown in the 44 years since 1980? They’ve grown, on average, 1440 per cent.

There’s been some level of growth in every five-year period since 1980, quite oblivious to what’s been going on with interest rates.

Right now, there’s lot of speculation from economists and other commentators that when the Reserve Bank eventually cuts the official rate, perhaps early in 2025, it will ignite property markets and cause property prices to rise.

These kinds of views, repeated multiple times in news media every day, have resulted in most people believing that property markets are indeed driven by events with interest rates.

History, including recent history, proves it simply isn’t so.

The Property Playbook is a dynamic real estate show that empowers investors and professionals with the insights and strategies needed to achieve strong returns in the Australian property market. Hosted by Tim Graham & Terry Ryder from Hotspotting.

In this episode, Tim Graham is joined by Ben Kingsley, Chair of the Property Investors Council of Australia. to discuss advocacy work for property investors amidst legislative changes and their impact on the housing market. Ben emphasises the need for balance in tenant rights and business returns and dissects the consequences of legislative changes in rental accommodation supply.

https://tickernews.co/shows/the-property-playbook/

Discover how to achieve the ultimate win-win in property investment: high rental yields and strong capital growth. In this replay of Hotspotting's exclusive webinar, Terry Ryder, founder of Hotspotting, and Tim Graham, General Manager, reveal key insights from their groundbreaking "Pulse Report." Key Topics Covered: The Affordability Advantage: * How affordable properties can outperform prime markets. * Debunking the myth that cheap real estate doesn’t grow.

Top Performing Locations: * A spotlight on suburbs and regional areas delivering over 6% rental yields and up to 29% growth in median prices. * Examples of areas like Rockhampton, Bunbury, and Mackay that tick all the investment boxes. * The Empirical Formula for Success * A step-by-step breakdown of the proprietary formula Hotspotting uses to identify high-potential locations.

Navigating Risk in a High-Interest Environment: * Why rental yield is crucial for cash flow and how to select properties that balance yield and growth. * The impact of infrastructure projects on capital growth potential.

The Shift Towards Units: * Why attached dwellings are outperforming houses in many markets. * Key trends driving this paradigm shift in Australian real estate.

Why Watch? This webinar offers unparalleled insights into the Australian property market, showcasing how strategic location choices can deliver exceptional returns even in challenging economic conditions. Whether you're a seasoned investor or just starting, this session is packed with actionable strategies to help you build a resilient property portfolio. Special Offer: Stay tuned until the end to learn about an exclusive deal on Hotspotting's premium "Pulse Report."

It’s been 15 months since Prime Minister Anthony Albanese made his big announcement about fixing the housing shortage – but there has been, as yet, no progress in lifting rental vacancies and suppressing rental growth.

The press conference making the announcement that the Federal Government would build 1.2 million new homes in five years was held in August 2023 – but more than a year later it’s clear that little progress has been made and that rental vacancies are not improving.

The latest figures on vacancy rates from SQM Research shows the national vacancy rate at 1.2% In October, unchanged from September and only a fraction higher than a year ago.

Five of the eight state and territory capital cities actually recorded a month-on-month reduction in their vacancy rates, while two others recorded no change.

The only capital city to have an increase in vacancies was Darwin.

Overall, the number of properties available for rental has dropped from almost 38,000 in September to 36,500 in October.

To put that in context, in December 2016 – the last time Australia had a vacancy rate close to 3% - there were 90,000 homes available for rent across the nation.

And Australia has added about three million people to its population since 2016.

Compared with a year ago, when the Federal Government was spruiking its big fix to the shortage of homes, five of the eight capital cities still have vacancy rates at similar or the same levels – and one, Hobart, is significantly lower than 12 months ago.

The highest vacancy rate among the eight capital cities is Canberra at 1.7% - the same as it was a year ago and significantly lower than the benchmark 3% which is considered in the industry to represent a balanced rental market with stable rents.

Now, a year is a long enough time for a government to move the dial on an issue like the rental shortage. Australia could improve this situation almost overnight by implementing measures to encourage and incentivise Australians to become landlords.

The big problem, which has been building now for many years, is that the nation has a chronic shortage of people willing to take on the task of being landlords – buying an investment property and making it available for others to live in.

Government doesn’t perform this role and neither does big business. Over 90% of the homes that people rent in Australia are provided by mum-and-dad investors – but fewer and fewer people are willing to do it, at a time when the costs of doing so are unattractively high and the rules and regulations keep changing to the distinct disadvantage of the owners.

Governments caused this rental shortage and they keep making it worse. So rental vacancies are unlikely to improve in the foreseeable future.

And while that remains the case, there will continue to be upward pressure on rents and an absence of choice for people who need to rent or choose to rent.

Four years ago, the median weekly rent for a house in Australia was around $440 – today it’s over $700.

There are multiple reasons why Australia has a housing shortage and why the numbers of new dwellings needed are simply not being built.

This is something I have spoken about regularly in the past and will continue to do so, as it’s the core issue creating problems for real estate consumers of all kinds – home buyers, investor buyers and tenants.

Here are the latest events and announcements which help to explain why we have a housing shortage with rising prices and rising rents, problems which are not going to be fixed in the foreseeable future …

ITEM 1 – BUREAUCATIC DELAYS: Sydney councils are sitting on backlog of almost 8,500 unresolved development applications and requests for development certificates, according to NSW government data.

There are over 5,000 unresolved development applications across the Greater Sydney area, plus 3,300 active “complying development certificates”.

Five councils each have more than 300 local development applications that are waiting to be finalised. Data from the Department of Planning Housing and Infrastructure lists the Inner West Council as the worst offender, with 456 “active” DAs waiting for a determination.

The Northern Beaches, Hills Shire and Cumberland Councils also have major backlogs.

Thousands more “complying development certificates” are also adding to the backlog, despite being designed to give faster approvals to developments that meet certain requirements.

Some councils are taking more than a year to approve homes. And some developers are waiting up to a decade for projects to be approved.

In my view, one of the core issues is that many councils have a NIMBY attitude to development, especially high-density residential. They simply don’t want developments to be built and do everything they can to frustrate builders.

ITEM 2 – NOT FINANCIALLY VIABLE: In Perth, the rate of apartment completions has dropped to its lowest levels since records began in the 1980s.

A new Property Council report says that, to meet the housing targets set by the National Housing Accord, WA would need to be delivering five times the number of apartments per year that it currently is.

The Sky High report says there are more than 10,000 apartments approved for WA but effectively on hold and unable to be constructed.

The major issue is that projects are just not financially viable – because the cost of delivering an apartment is generally higher than the market is willing to pay, so projects simply don’t stack up. Only luxury apartments are economically viable projects.

The report blames climbing construction costs - driven by labour shortages and competition for labour from government and mining sectors.

The report says: “Developers are reporting that construction cost estimates are now almost double the cost of similar developments five years ago.”

The Property Council expects that costs will climb even higher as the new national construction code and bargaining agreements imposed by government take effect.

This is problem not only in Perth but right across Australia. Developers are scrapping unit projects because the costs are so high, making them financially unviable.

The Australian Construction Industry Forum says it’s a worrying trend for a country that needs more, denser homes – not only apartment towers but medium-rise and townhouse developments in existing suburbs – to tackle the chronic undersupply of housing and to ensure longer-term affordability.

The forum’s Construction Forecasting Council chair and chief economist Nerida Conisbee says: “It’s very, very expensive to build apartments. Many projects aren’t going ahead.”

ITEM 3 – WORKER SHORTAGES: A recent report reveals that Australia needs 130,000 additional workers to combat labour shortages in the construction sector. This has prompted calls for rapid reforms from both federal and state governments to attract and retain skilled labour.

The report says the nation is on track, in 2024, for the worst year in new home builds in over a decade, with an 9 per cent decline in new building starts, totalling just 158,000 when it needs to be 240,000 per year to meet the Federal Government’s fanciful target of 1.2 million new homes in five years.

Construction starts for detached houses have dropped by 10 per cent, while higher-density projects have declined by 6 per cent. If this pace continues, Australia could see fewer than 800,000 new home starts over the five years, leading to a shortfall of over 400,000 homes compared to the National Housing Accord target.

The decline in apprenticeship numbers further compounds this crisis, with completions down 8 per cent and commencements down 12 per cent in the past year.

ITEM 4 – POLITICAL POLICIES: The Housing Industry Association says a home building recovery is possible because buyer demand is rising, but state government housing policies risk stalling the revival.

HIA Senior Economist, Matt King, says demand for new homes nationally is accelerating - largely due to high population growth, low unemployment, stable incomes and the absence of interest rate rises for the past year.

King says activity generally is picking up, but there are big differences across capital city and regional markets. Sydney remains an outlier and there is still no indication of a near-term rebound in residential building in the big city.

King says: “New home building in the Sydney basin remains exceptionally low, primarily due to high land prices and excessive housing taxes and infrastructure charges.”

Australia-wide, the HIA says the detached home building sector looks promising, but the unit sector remains constrained and is unlikely to experience recovery before mid-2025.

King says: “The sector continues to be dampened by skilled labour shortages, business credit constraints and the aftermath of significant building material cost escalation.

“The extent of the recovery in new home building will be determined by the ability of governments to ease the barriers to home building.

“Recent state government plans to increased surcharges on foreign investors and introduce taxes on short-term rental accommodation are unhelpful at a time when stability is needed to achieve the target of 1.2 million homes.”

King says the rate of home building is being slowed down by government failure to implement policies such as expedited land releases, concessions on property taxation, and accelerated development approval time frames.

ITEM 5 – HIGH LAND COSTS: The rapidly prising cost of home sites is one of the biggest barriers to easing the housing shortage.

New figures for South East Queensland indicate that the cost of residential home sites has jumped by as much as $120,000 in a year – up 21 per cent in one LGA where it now costs as much for a block of land as the median home did just two years ago.

This is the City of Brisbane LGA where land prices rose 8.7 per cent in the September quarter alone, pushing the median price of a block of land to $685,000 – which is $3,000 more than what an established home cost in this area in June 2022.

The second biggest annual surge in land prices occurred in the City of Ipswich where the median block rose 15 er cent or by $48,000 to hit $360,000, with the third fastest pace set by Moreton Bay, where prices rose by 10 percent to $415,000.

The cheapest blocks of land in South East Queensland are in Logan City in Brisbane’s south, where a third of SEQ land sales are now occurring – with the median price at $350,000 after a rise of almost 10 percent across the year.

The Gold Coast had the second highest SEQ land price at $619,000, after an 8 percent rise in the past year.

So, you can imagine what a new house on a block of land costs, when the land alone costs well over $600,000 – as it does in the City of Brisbane and on the Gold Coast.

Why does it cost so much? Primarily because of bureaucratic delays, governments taxes fees and charges, and high interest rates – all problems created by our elected representatives.

If I asked you to nominate the market which had recorded the best long-term capital growth in Australia, what would your answer be?

Sydney, the capital city with the nation’s highest property prices?

Perth, which has had a booming property market lately and has led the nation on price growth for past couple of years?

Brisbane, which always attracts strong demand from buyers of all sorts?

Or perhaps Regional Queensland, which benefits from internal migrants moving from others parts of Australia and from investors seeking affordability and strong yields?

The correct answer is none of the above.

The market jurisdiction which has led the nation on long-term capital growth is: Regional Tasmania.

This is the outcome of research conducted by the Property Investment Professionals of Australia (PIPA), which analysed Australian Bureau of Statistics’ data on established median dwelling values over 20 years - from June 2004 to June 2024.

The top location recorded growth of 233% while the worst grew 100% over the two-decade period.

In comparison, over the past 20 years, the stock market (S&P/ASX 200) increased by 120%, according to investing.com.

In general terms, the best capital growth has been smaller capital cities or more affordable regions.

The top result was “the Rest of Tasmania”, which means Tasmania outside of the capital city Hobart or Regional Tasmania - where its established median house price rose from $169,000 20 years ago to $449,000 in mid-2024.

The best capital city performers were also some of our nation’s most affordable throughout the period with Adelaide, Hobart, and Brisbane taking out the top three city rankings.

PIPA comments that property markets are not linear – rather, price growth occurs at varying points over time. Hobart, for example, has experienced a softening of prices over the past few years, but its house price have almost tripled since 2004 – up 193% in 20 years.

Adelaide and Brisbane have both had very strong markets in the past two years but both had long periods of flat-lining prices throughout the past two decades.

It reflects the reality that real estate consumers get the best results through long-term ownership and PIPA Chair Nicola McDougall says property owners should always adopt a long-term mindset.

But PIPA research indicates many investors don’t follow that philosophy.

PIPA’s 2024 Annual Investor Sentiment Survey found that 61% of investors who sold in the past year had a holding period of less than 10 years – and 17% of those investors who sold indicated they had owned the property for less than three years.

So the rankings from the PIPA research on capital growth over the past 20 years are:

1 Regional Tasmania

2 Adelaide

3 Hobart

4 Brisbane

5 Regional Victoria

6 Perth

Sydney ranked seventh and Melbourne 11th, once again disproving one of the real estate’s greatest myths, that you get the best capital growth in the biggest cities – and that prime out-performs affordable.

And the worst performers were Darwin and “the Rest of Northern Territory” – but even the remote markets of the NT achieved a doubling of property values over 20 years.

The Property Playbook is a dynamic real estate show that empowers investors and professionals with the insights and strategies needed to achieve strong returns in the Australian property market. Hosted by Tim Graham & Terry Ryder from Hotspotting.

In this episode, Tim is joined by Hotspotting Founder and Director Terry Ryder. As an experienced real estate expert, Terry Ryder shares insights on identifying prime real estate investment locations in Australia. He introduces the Price Predictor Index, a model that predicts short-term property growth based on sales volumes. Ryder emphasises the significance of monitoring buyer activity, infrastructure investment, and market size when identifying promising real estate markets.

https://tickernews.co/shows/the-property-playbook/

Welcome to a special episode of Hotspotting’s pre-recorded interview series, Interviews with the 1%, where we dive into the strategies and journeys of Australia’s top investors—the elite 0.87% who own five or more properties. Hosted by Tim Graham, this series brings you invaluable insights from seasoned investors who have achieved what many aspire to.

In today’s episode, we sit down with Lisa Chapman—a property entrepreneur, investor, and co-creator of the luxury retreat, Eden Yarra Valley. Lisa shares her journey from a high-powered corporate career to becoming a full-time property entrepreneur, carving a unique niche in the accommodation and real estate sectors.

What You'll Learn in This Episode: * The Mindset of the Top 1%: Discover what separates successful investors from the rest, as Lisa reveals her strategies and lessons learned from owning multiple properties. * Lisa’s Property Journey: From buying her first house at 22 to establishing diverse real estate ventures across the Yarra Valley and the Mornington Peninsula. * Creating Eden Yarra Valley: Hear the inspiring story of transforming a run-down property into a high-end retreat that caters to milestone events, weddings, and corporate retreats. * Navigating Career Transitions: Insights into Lisa’s pivot from a high-stress corporate career in PR and real estate marketing to her fulfilling role as a property entrepreneur. * Tips for Aspiring Investors: Practical advice for those looking to build their property portfolio, including lessons from Lisa’s successes and challenges.

About Lisa Chapman: Lisa Chapman’s remarkable career spans television, marketing, public relations, and real estate. She managed national and global campaigns, including the iconic launch of Melbourne’s Eureka Tower and Skydeck. After decades of corporate success, Lisa made a bold shift during the COVID-19 pandemic to focus on her passion for real estate and the Experience Economy.

Today, Lisa is the proud co-creator of Eden Yarra Valley, a luxury retreat offering bespoke accommodation for up to 30 guests. From weddings to wellness retreats, Lisa’s innovative approach to property investment highlights the value of creating meaningful experiences for clients.

Key Takeaways from Lisa’s Story: 1. The Power of Vision: Lisa’s ability to see potential in underutilized properties has been central to her success. 2. The Value of Experience: Transitioning from corporate PR to property entrepreneurship, Lisa leveraged her marketing expertise to create a standout brand. 3. Lessons from Investing: Lisa shares actionable advice for both new and seasoned investors, including how to identify opportunities and manage challenges.

Notable Quotes: * “We are living in the Experience Economy. Today, people are looking to invest in meaningful moments, not just material assets.” * “Real estate is about creating value—whether it’s a luxury retreat or an investment property. The potential is there if you’re willing to look.”

Connect with Lisa Chapman: * Website: edenyarravalley.com.au * Email: lisa@edenyarravalley.com.au

Subscribe to Hotspotting’s Podcast: Stay tuned for more episodes of Interviews with the 1%, where we uncover the stories behind Australia’s most successful property investors. Don’t forget to like, share, and subscribe on your favorite podcast platform!

Host: Terry Ryder, Founder of Hotspotting.com.au Guest: Steve Palise, Commercial Property Expert and Founder of Palise Property

In this insightful webinar, Terry Ryder sits down with Steve Palise to explore the exciting world of commercial real estate. With decades of combined experience, Terry and Steve unpack key trends, strategies, and opportunities in non-residential property investment. Whether you’re a seasoned investor or just starting to consider commercial property, this session is packed with actionable insights.

Topics Covered: * Why Investors Are Turning to Commercial Real Estate: Higher yields, flexibility, and unique financing options make commercial property an attractive choice. * Types of Commercial Properties: Industrial, retail, and office spaces—what to look for and how to assess opportunities. * Key Market Trends: Vacancy rates, regional hotspots, and the impact of infrastructure projects on property value. * Risk Management: The importance of due diligence, understanding leases, and analyzing tenant dynamics. * Investment Fundamentals: How residential market indicators can inform commercial property decisions.

Key Takeaways: 1. Superior Yields: Learn how net yields in commercial real estate often surpass those in residential investments. 2. Market Nuances: Discover why regions like Brisbane and Perth offer exceptional opportunities for commercial investors. 3. Educational Resources: Steve shares free tools, checklists, and courses to help investors navigate the complexities of commercial property.

💡 Thinking about investing in commercial property? This webinar will help you understand the landscape and take your first steps toward creating a diversified, high-performing portfolio.

🎧 Listen to the Podcast: Stay updated on all things real estate by subscribing to our podcast on your favorite platform.

🔗 Connect with Us:

Visit Hotspotting.com.au for more resources.
Visit PaliseProperty.com for more information on Steve's business.

You can also access Steve's Commercial Property Course by visiting: https://www.commercialpropertyinstitute.com.au/

Use the code word Hotspotting to receive a 100% discount!

There are many reasons Australia has a dwelling shortage and affordability problems – including the increased time it takes to build a new home.

In recent years, it typically took around nine months on average to build a house in Australia. Today it takes 13 months.

It’s worse for businesses which are constructing apartment complexes.

Recent analysis from Master Builders Australia has revealed that building times for detached homes and apartments have almost doubled – with a consequent impact on costs.

Master Builders says: “It shouldn’t take this long to build a home”.

These findings, obtained from recent analysis of Australian Bureau of Statistics (ABS) data, show that it took an average of 13 months to build a detached house in FY2024, marking a 40 per cent increase on the average compared to a decade ago.

Master Builders noted that construction times had lengthened even further for apartment buildings, with the average of 33 months from approval to completion in FY2024, representing an 80 per cent increase on the average of 18.5 months observed in FY2011.

That warrants repeating: it previously took a year and a half to get the average apartment building completed, but now it takes almost three years.

And that’s the national average situation: it’s considerably worse in some states.

You don’t need to be a financial genius to understand what that does to the costs of building new homes in Australia.

CEO of Master Builders Australia, Denita Wawn, says these extended construction time frames are hindering the industry’s ability to address housing demand and confront the housing crisis.

She says: “There are a range of contributing factors including labour shortages, declining productivity, union pattern agreements, supply chain disruptions, complex regulatory requirements, occupational certificate backlogs and critical infrastructure delays.”

Wawn points out that, with the advancements which have occurred in technology and construction methods in recent years, “we should be building homes faster, not slower”.

Master Builders called for action to be taken to address the bottlenecks and inefficiencies around construction processes.

They suggest streamlining government approval processes, encouraging adoption of digital solutions, introducing incentives to grow the workforce through domestic and international means, and strengthening the domestic supply chain.

Master Builders chief economist Shane Garrett says that the latest ABS data on home completions indicate the country is on track to fall well short of the National Housing Accord target of 1.2 million homes by 2029 – indeed, by “over 400,000 homes”.

It’s long been the case that the two most populous states, New South Wales and Victoria, have attracted the highest levels of property investment – just by sheer weight of numbers.

But Victoria has lost its spot among the big two of property investment and is now being overtaken by Queensland.

Meanwhile, Queensland now leads the nation is overall real estate transactions, including purchases by both home-buyers and investors.

This is despite Victoria having a population of 7 million, versus 5.5 million in Queensland.

It provides further evidence that investors are deserting Victoria because of the raft of anti-landlord measures from the State Government, with more still to come.

And that Queensland is where buyers are all kinds are heading.

Analysis of ABS figures shows that, a year ago, 26 per cent of investor loans were for Victoria properties and around 22 per cent for Queensland.

More recently, the balance has shifted with Victoria dropping to 23 per cent of investor loans and Queensland continuing to rise.

Money.com.au says investors are abandoning Victoria for several reasons, including Victoria’s additional taxes on investors, and are flocking to Queensland.

Home Loans expert Mansour Soltani says: “Queensland is emerging as the new promised land. It has everything property investors look for including a strong local economy, population growth, expanding regional markets and ongoing infrastructure projects.”

Queensland is leading the nation with a 36 per cent year-on-year increase in investor loans, compared with the national average of 21 per cent.

Regional markets such as Townsville, Bundaberg, Rockhampton and Gladstone are offering low entry costs and above-average rental yields.

Soltani also says: “Queensland is not only leading investor activity — owner-occupied loans in the state grew by 12 per cent year-on-year, while no other market grew by more than 6 per cent, and New South Wales saw no growth.”

Realestate.com.au reports that nearly $40 billion was spent on residential property in Queensland in the past quarter, with the state recording the highest number of home sales in the country in the last three months.

Brisbane’s median dwelling price has also extended its lead over Melbourne’s — climbing to $885,000 in October, while Melbourne sits at $780,000, according to CoreLogic.

New figures from digital settlements platform, PEXA, show over 48,000 home sales were finalised across Queensland in the September quarter, with home buyers spending $38 billion — 27 per cent more than the same period a year ago.

The postcodes with the highest number of home sales in the three months were found in Toowoomba, the Gold Coast and Mackay.

Homebuyers also moved to regional coastal areas such as Bargara near Bundaberg and Urangan in the Hervey Bay region, as well as new housing development areas in Logan City and Ipswich City on the fringes of Greater Brisbane.

Whenever I’m asked for my rules for successful investing, I usually begin my response with this: Rule One – stop reading newspapers.

Expressed in a more 21st Century context, stop treating media soundbites as research.

People who base their investment decisions on the white noise in news media are running the risk of making very bad moves in the market.

My observation of the content of news media coverage of residential real estate is that there is far more misinformation than real, accurate, reliable information.

In modern media it’s all about clickbait and I find repeatedly that the headline presented to induce you to CLICK is highly misleading – and sometimes an outright lie.

I could provide dozens of examples from this week alone, but here’s just one classic example.

The headline above an article published on the news.com.au network, the nation’s biggest news organisation, proclaimed: “Worst is over: where rents are plummeting”

This was followed by the following opening statement:

“The worst of the rental crisis appears over across much of Australia, with rents plummeting in these areas. But it’s not all good news.”

Now the headline in this case is more than a lazy piece of sensationalism – because, not only is it untrue to claim that “rents are plummeting” but the content of the article does not support the claim in the headline.

You may have observed that, in the surreal world of journalists, nothing falls or decreases or drops – it collapses, it nosedives, it falls off a cliff – and, yes, it plummets.

Even when the decline is a few percent, barely a blip, it will be declared to be plummeting.

So having made the statement that rents were plummeting and that the worst of the rental shortage crisis was over, the New Limited article utterly failed to deliver on this very big statement.

If it was true, it would be one of the stories of the year. But, of course, it wasn’t true.

According to the article, Queensland’s asking rents “have surged again, increasing across 252 Queensland suburbs by up to 15 per cent since June”.

I’ve checked my dictionary definition of “plummeting” and it certainly doesn’t apply to the Queensland situation.

Next, Victoria. According to this article, there are more than 200 suburbs where rents are now at least $100 a week more expensive for units than in 2021.

It said: “Well-connected areas like Ashburton, Parkville, Aspendale, Caulfield South, Glen Waverley and Carlton have posted some of the biggest rises in weekly unit rents across the past three years, all of them up more than 40 per cent, according to new PropTrack data.”

No sign of anything plummeting in Victoria – where, incidentally, many investors have sold up and got out of the state because of draconian anti-landlord measures by the state government. So we can expect rents to keep rising in Melbourne.

In Adelaide, rents have fallen a little in the latest quarter in 17% of suburbs examined by PropTrack, but there’s no sign of plummeting in the other 83% of suburbs.

Adelaide, in fact, has had extraordinary growth in rentals in the past year and, with the vacancy rate still hovering around 0.6%, there’s no real basis for declaring that “the worst is over”.

In Perth, the vacancy rate remains well under 1% and there is no real prospect of rent relief any time soon.

So, looking through the entire article, the only evidence presented to go even close to supporting the noise in the headline is in Sydney.

According to this shoddy piece of “journalism”, Sydney has entered a correction phase.

PropTrack attributes the market slowdown to more rental homes becoming available and tenant demand dropping as more renters moved to share houses or back in with their parents to save money. Migration has also waned in recent months.

PropTrack says: “Demand and supply are working together to see a stabilisation in rental market conditions.”

But no evidence was presented in the article to support the notion that Sydney rents are nosediving.

So, in summary, only in Sydney is there evidence that “the worst is over” and there is nothing at all in this work of fiction is justify the claim that rents are plummeting – anywhere.

So, what is a realistic overview of the situation with the rental shortage crisis.

Nationally, the vacancy rate continues around 1% or slightly above 1%, depending on whose figures you believe.

None of the eight capital cities has a vacancy rate anywhere near 3%, which is the benchmark for a stable rental market with steady rents.

There are no government measures in play which will move the dial on this in the foreseeable future – except decisions which are likely to make it worse, rather than better.

In some locations, however, I do expect rental increases to moderate, because a ceiling has been reached in terms of the market’s ability to pay.

Amid a cost-of-living crisis, tenants cannot keep paying higher and higher rents, regardless of how many people they jam into a three-bedroom house or small apartment.

But rents plummeting? We’re unlikely to see that anywhere, not while vacancies are as low as they are.

At Hotspotting we believe real estate markets are local in nature and are subject to the strength or weakness of the local economy.

While economists cling to their kindergarten theory that markets are essentially driven by interest rates, the stark differences in local markets across Australia suggest that there is something more powerful in play.

If it were true that high interest rates mean prices will fall, then everywhere in Australian would have falling property prices in 2024, which is what major bank economists and others like them predicted at the start of the year.

The reality that Perth, Brisbane, Adelaide and many key regional centres have had booming property prices indicates that (a) the economists are wrong in their simplistic theory; and (b) there are larger forces of influence, which are local in nature.

And the record shows that the local economy is the key factor, over-riding any influence from interest rates, which are the same everywhere in Australia.

For that reason, I always take note the quarterly editions of The State of the States report published by CommSec, which is part of Commonwealth Bank.

For many years I’ve detected a correlation between the findings of that report and outcomes with property prices in our capital cities and our regional markets.

The report uses eight different metrics, including construction work, population growth, retail spending, housing finance and employment data, to rank the eight state and territory economies.

The latest quarterly edition of State of the States ranks the states and territories like this: Western Australia 1, South Australia 2, Queensland 3.

Not coincidentally, the leading cities with booming property prices are, in order, Perth 1, Adelaide 2 and Brisbane 3.

In addition to that, the leading regional markets are Western Australia, South Australia and Queensland.

The report finds that the greatest strength for WA is population growth while the greatest weakness is dwelling starts – and those two factors working together would tend to put upward pressure on property prices (and rents).

South Australia’s greatest strength is economic growth while in Queensland it’s housing finance.

The jurisdictions with the weakest economies – the Northern Territory, the ACT and New South Wales – are also the places where property prices have been weak recently.

So if you want a simple method of detecting where dwelling prices are most likely to be strong, keep track of the quarterly editions of the State of the States report.

Household wealth in Australia keeps rising and it’s residential property that’s responsible.

The latest figures from the ABS show that overall household wealth has increased for the seventh consecutive quarter.

It rose a further 1.5 per cent in the June quarter to a record $16.5 trillion, driven primarily by property assets.

Total household wealth is now 9.3 per cent higher than it was a year ago, driven by residential land and dwellings.

Of the 1.5 per cent rise in the June quarter, 1.3 percentage points was attributed to residential property – our homes and investment properties.

Dr Mish Tan, head of finance statistics at the ABS, said: “House prices have continued to rise across most states and territories.

“This largely reflects ongoing housing supply constraints and an uptick in investor activity over the quarter.”

Residential real estate assets now account for approximately two-thirds of total household wealth. Property assets reached an unprecedented level of $11.22 trillion as of 30 June, making up around 68 per cent of household wealth, driven by rising property prices.

Households also hold $1.72 trillion in cash and deposits or 10.4 per cent of their total net worth, alongside $3.94 trillion in superannuation assets.

Everyone seeking real estate in desirable locations has the same complaint: the lack of stock. Home buyers, investors, buyers’ agents and selling agents are all being frustrated by the shortage of listings of properties for sale – particularly quality options.

Leading national buyers’ agency Adviseable says a partial solution for buyers is to consider building from scratch rather than buying an established property. The tactic has many advantages – and one or two problems as well.

Alex Dutt of Adviseable says deciding whether to buy an established property or to go down the new construction route is not always a simple choice. It can be difficult to cut through the noise and find a truly unbiased insight into the topic to determine which strategy is the right one for you.

Adviseable has put together an honest, warts-and-all exploration of the pros & cons of buying an established investment property versus going through the process of building a new one.

And on Wednesday 30th October, Alex Dutt joined Hotspotting founder Terry Ryder to discuss the issues involved in making that choice. He points out that Adviseable, as a buyers’ agency, has no vested interest in which choice an individual buyer makes. So it can present the advantages and disadvantages without fear or favour.

www.adviseable.com.au

In my experience, most people who have a loud view about scrapping negative gearing are people who can’t explain what it is, how it works, why it’s bad and how ending it would solve all the problems in the housing industry.

Mostly, what’s in play with this issue is THE POLITICS OF ENVY – that nagging feeling some people have, that others are doing better than they are, or are receiving benefits that they are not, and therefore need to be squashed.

As a famous Indian guru once observed, some people try to be tall by cutting off the heads of others.

Contrast that with the views that are expressed when they come from people with the expertise and experience to understand what negative gearing is, how it works and what the consequences would be if it was removed.

A recent poll of such people found that the disadvantages would outweigh the advantages.

Before delving into the comments of experts who have been interviewed by news media about this recently, let me remind everyone that Australia DID end negative gearing in the 1980s and within two years the same Federal Labor Government that scrapped it, did a major backflip and reinstated it.

Why? Because it caused a serious shortage of rental properties and higher rents. And it didn’t bring down property prices or improve housing affordability.

Let me also remind you that more recently New Zealand put an end of negative gearing tax benefits and right now that nation’s government is reinstating it – because, as happened in Australia in the 1980s, the upshot was a rental shortage and higher rents.

In the light of those precedents, you have to wonder why we’re having this debate at all.

Now, returning to a recent survey of so-called experts polled by the Australian Financial Review – the majority view, arising from that survey, was that the consequences of changing tax arrangements for property investment are likely to include higher rents.

Why? Because investors would exit the housing market, causing a further drop in supply of rental homes at a time when Australia has the lowest vacancy rates ever recorded.

Analysts polled in the quarterly Australian Financial Review property survey, overall, painted a “BE CAREFUL WHAT YOU WISH FOR” scenario amid a national debate over the merits of changes to negative gearing and capital gains tax – which is usually described by media, inaccurately and unfairly, as a CONCESSION.

Those polls said any benefit to first home buyers from any price falls – which are hypothetical and not based on any precedent or research - as investors exit the market would be modest, potentially short-term and effectively traded off against a consequent squeeze in supply.

Here’s one prediction from a respondent to the survey:

He says: “By lowering the after-tax return to investors, any move to wind back the negative gearing benefit and increase capital gains tax would lead to a fall in investor demand for housing and a short-term fall in prices, say of 3-4 per cent.”

However, those comments from Australia’s worst forecaster of residential property outcomes, AMP chief economist Shane Oliver – so the forecast that property prices would fall is somewhat dubious. That certainly didn’t happen in Australia in the 1980s or in New Zealand after they, more recently, ended negative gearing.

In any case, Oliver goes on to say: “However, this (slight fall in prices) is likely to be short-lived as less investor participation in the property market would ultimately lead to a lower supply of new homes to the property market, higher rents and then a blowback to higher prices.

“It will do nothing to fix the basic problem which is a chronic undersupply of housing relative to population-driven demand.”

That much he got right.

Proptrack’s executive manager for economic research, Cameron Kusher, said the removal of negative gearing and increasing capital gains tax might marginally reduce house prices, but consequent discouragement to investment would reduce supply.

He said” “It’s important to look at the taxation system holistically rather than in a vacuum, especially whilst the rental market remains challenged.”

In other words, there would be more disadvantages than advantages.

Barrenjoey’s chief economist Jo Masters warned of the “unintended consequences” of modifying the current settings.

She said: “Negative gearing and capital gains tax reform alone are not a silver bullet and need to be debated both in the context of broad tax reform, and the other levers available to the housing sector, including supply.”

Nicola Powell, Domain’s chief of research and economics, said that it was “a common misconception” that the negative gearing and CGT provisions were “primarily enjoyed” by wealthy, older Australians.

Powell said most investors own just one property, and a larger share of them are under 50.

She said: “If negative gearing were removed or scaled back, younger, more financially vulnerable investors – especially those with just a single property – would be the first to feel the impact, potentially leading them to sell. Meanwhile, wealthier investors, who are more likely to be positively geared, have greater financial flexibility and would be less affected.”

Like other respondents, Jarden analyst Lou Pirenc says any benefit from the departure of some investors from the market it would come at a cost.

He said: “Longer term, growth to new housing supply could be further weakened with less incentives for investors to enter the market, especially as the cost of owning an investment property currently remains unattractive.

“This,” he said, “could potentially see house prices RISE longer term as the imbalance between demand and supply exacerbates.”

Indeed. So the consensus among those commentators is that removing negative gearing tax benefits and increasing capital gains tax would not provide any long-term improvement in housing affordability but would reduce the supply of housing, particularly rental homes, and PUT FURTHER UPWARD PRESSURE ON RENTS.

But try telling that to the Greens, whose draconian anti-real estate policies were a primary reason they were the big losers in the Queensland state election at the weekend.

Politicians and journalists love to scapegoat and demonise, particularly with issues impacting housing markets – with property investors always a popular target.

Australia’s love of scapegoating is one of the reasons the nation seldom resolves any of the key issues it faces.

Politicians hold press conferences, they stage inquiries, they bring on royal commissions, they make announcements – but the recurring theme is looking for someone to blame and to vilify – preferably someone other than themselves.

In real estate, investors and related issues like negative gearing are blamed for all the problems afflicting the housing industry – including poor affordability and rising rents.

But, according to analysis by the Reserve Bank, property investors have copped the brunt of rising interest rates and haven’t passed on their impact to tenants in the form of higher rents – or, not much.

New Reserve Bank research debunks the idea that so-called greedy landlords simply pass on higher mortgage costs to their tenants via rent increases.

According to the RBA analysis, after analysing years of investor tax returns, for every $1 increase in home loan interest repayments, property investors have raised rents by just 1¢.

The RBA economists who wrote the report said: “To put this effect in context, the median monthly interest payment for leveraged investors increased by around $850 between April 2022 and January 2024.

“Our estimate suggests that this $850 increase in interest costs would have raised rents by less than $10 per month, or just over $2 per week.”

The research, released in the RBA’s quarterly bulletin, is an attempt by the central bank to refute the commonly held perception that landlords pass simply higher interest rates on to renters.

While there is a public perception that rents and interest rates tend to move in tandem, the RBA says this is more a case of correlation rather than causation.

The RBA says: “Pinning down the relationship between interest rates and rents is tricky because both will tend to move together with the economic cycle.

“For example, a strong economy, with a pick-up in income growth, will see increased demand for rental properties. This will put upward pressure on rents. At the same time, interest rates may be raised to reduce inflationary pressures.”

So they’re saying that rising rents and rising interest rates tend to occur at the same time, rather than one causing the other.

The sample period for this research includes two other interest rate tightening cycles, including immediately before and after the global financial crisis.

RBA governor Michele Bullock said in August the fundamental reason rents were increasing so quickly was because there was not enough housing supply to meet demand.

Bullock told a parliamentary hearing: “Landlords can only pass on interest rate rises into rents if there is demand for those properties. If there isn’t, then it’s very difficult for them to pass those costs on.”

The researchers said that housing demand had been strong due to high population growth and an increase in the number of households with spare rooms.

Meanwhile, supply had been hampered by rising construction costs, which the RBA says have increased 40 per cent over the past four years – although other estimates say they have risen more than 50% in the past three years.

You could argue that the RBA has a vested interest in the argument they are presenting, because many believe that higher interest rates have driven increases in rents over the last few years - and therefore Bullock and the other financial elites on the RBA board are to blame for the rise and rise of residential rentals.

What do I think? I don’t think much of the RBA and its arrogant out-of-touch behaviour which sees only economic graphs, charts and numbers – and displays no feeling for the impact of their ivory tower decisions on ordinary Australians, without achieving the end goal of actually taming inflation.

But, I think they’re correct in this instance.

Higher interest rates have not caused higher rents. It doesn’t matter how high interest rates go, or any of the other rising costs of property ownership – investors can increase rents ONLY if there’s high demand and low supply.

It’s historically low vacancies that have caused rents to rise and rise – not high interest rates.

How long could we reasonably expect governments to take, to sort out a problem like the rental shortage?

I ask the question because we have had the problem of a shortage of options for tenants in Australia – and the consequent steep rises in rents - for a very long time.

And it keeps getting worse, not better.

The latest data from SQM Research shows that, nationally, the vacancy rate got a little worse last month, dropping from 1.3% in August to 1.2% in September.

Three of our capital cities have vacancies well below 1%.

And in six of the eight capital cities, vacancies stayed the same or got smaller in September. In only two cities was there a slight improvement.

But the key piece of information is the longevity of this rental shortage crisis.

Australia has had vacancies below 1.5% for close to three years now.

It’s generally considered that a balanced rental market – one in which there is ample supply of homes for tenants to choose from and rents are stable – is one where vacancies are at least 3%.

The data from SQM Research shows that Australia has not had a vacancy rate as high as 3% at any time in the past 20 years.

The closest we came was 2.9% in April 2020 after the onset of Covid caused major disruption to property markets.

Since then, the national vacancy rate has dropped sharply, reaching 1.2% in March 2022 – and it has hovered between 1% and 1.3% for the past two and a half years.

According to SQM Research, a further 1,700 rental properties disappeared from Australia’s rental market in September – at a time when the nation’s population has surpassed 27 million.

The SQM report said: “The total number of rental vacancies now stands at 37,932 residential properties, a decrease from 39,665 in August.”

There are clear reasons why we have had this steady decline in the number of properties available for rental, a shortage which has caused rents to rise and rise.

Mostly, those reasons relate to the decisions of politicians, particularly state politicians, in making life increasingly onerous for the investors who provide over 90% of the homes that people rent in Australia.

State and territory governments have increased taxes on investors and have changed the rental laws in ways that have eroded the rights of the owners.

This has led to a reduction in the number of homes available for rental.

In Victoria, the state with the most onerous conditions for investors including big tax increases, the number of rental properties in the state has fallen by 22,000 so far this year, as the investor exodus gathered momentum on the back of anti-landlord legislation.

That’s according to new data from the Department of Families, Fairness and Housing.

And its data supports a trend identified in the latest Investor Sentiment Survey published by PIPA – the Property Investment Professionals of Australia (PIPA).

The survey described a "sell-off of investment properties around the nation" that has "continuing unabated" and "fuelling fears of an even tighter rental market".

But the problem is most acute in Victoria. PIPA Victoria board director Cate Bakos says legislative changes and increased taxes are driving investors from the state.

A new land tax regime, minimum rental property standards legislation, and policies that are seen as overly tenant-friendly have caused many investors to sell up in Victoria.

Nicola McDougall, the Chair of PIPA says: “This is predominantly due to its plethora of anti-investor rental reforms, as well its new land tax regime that is set to cost investors billions of dollars over the years ahead.”

PIPA’s annual investor sentiment survey found Victoria was regarded as the “least accommodating” state or territory for property investors in the nation, with 22% of survey respondents indicating they had sold at least one dwelling in Melbourne in the last year.

As a consequence, rental availability has fallen and rents have risen.

Data from Domain shows that the vast majority of Melbourne suburbs recorded rent rises this year, continuing a trend that has extended over several years.

According to the Domain rent report for the September quarter, the median house rent in Melbourne at the start of 2022 was $440 a week. Now it’s $580 a week.

The median unit rent was $375 a week in January 2022 and now it’s $550 a week. That’s an increase of almost 50% in less than three years.

But the problems keep getting worse, with NSW being the latest state government to pass new laws detrimental to landlords.

REINSW CEO Tim McKibbin says the lessons for the NSW Government are crystal clear but have been disregarded.

He says: “The removal of landlords’ rights under the guise of populist rental reforms has had a clear negative impact on renters elsewhere.

“The rental reforms by the NSW Government will result in more investors selling up or opting for a short-term accommodation strategy, both of which remove more properties from the private rental market.

“This is already happening and it’s happening at a time when the NSW population is increasing by over 15,000 people each month. The rental market is in crisis and we need solutions, not reforms that we know from recent experience will make the problem worse.”

And that pretty much sums up the seriousness and absurdity of this ongoing issue.

Australia has had a rental shortage crisis for several years but the only policies implemented by state governments have made a bad situation even worse.

There is one thing that Australian politicians are really good at – possibly the only thing - and that is diverting attention from the real issues and scapegoating others for the problems that they, the politicians, have caused.

Right now, the core issues impacting Australian households include the housing shortage, the high cost of creating desperately needed new homes, the chronic rental shortage and the reality that rents keep on rising.

It’s noteworthy that the recent AGM of the Commonwealth Bank reported that they have had to provide emergency payment arrangements to 132,000 customers who are struggling to pay their mortgage amid a cost of living crisis and very high interest rates.

We also have saturation media coverage of the plight of tenants paying higher and higher rents amid a chronic shortage.

So, what are politicians and journalists obsessing over? The issue of negative gearing.

Now, what relevance does negative gearing have to the issue of the housing shortages and the high cost of building new homes and the chronic shortage of rental properties?

The answer is: None.

It has no relevance whatsoever.

Scrapping negative gearing won’t fix any of these problems – but it will make some of them noticeably worse.

Recently columnist James Kirby wrote about this in The Australian.

He wrote:

“Experts are warning the government’s review of property tax concessions could make housing affordability worse, with New Zealand’s recent failed attempts to do something similar cited as an example of what could go wrong.

“After the NZ government cut tax incentives for property investors three years ago, the volume of investment funds entering the residential market halved. And as the supply of rental property evaporated, rental prices soared.”

Kirby wrote: “The attempt to change New Zealand’s version of negative gearing – and its capital gains tax regime – were widely seen to have backfired and a new government has since progressively reversed the original changes.”

However, Kirby points out, the Treasury in Canberra is now assessing the same tax territory with a review of negative gearing (where property investors can declare losses against tax) and Capital Gain Tax.

Kirby says: “While Anthony Albanese has distanced himself from the review – insisting it is an internal move by Treasury – tax changes around property investment are highly sensitive, especially as the ALP’s Shorten-era election loss was significantly due to unpopular plans to restrict investor tax incentives.”

Ray White group chief economist Nerida Conisbee says: “The current tax incentives ensure we have enough rental housing, if you cut those incentives you only have to look at New Zealand to see what may happen – New Zealand is now the least affordable rental market in the world.’’

Kirby wrote: “Put simply, making property investment less attractive will drive investors out of the market. The only question is the degree to which they will flee and that in turn depends on conditions at the time. In New Zealand the reform measures were imposed as prices were falling and interest rates were rising – exacerbating the blowback from investors who cut their funds in the NZ market from $21bn in 2021 to just $11.8bn in 2024.”

Kirby also referred to the fact that Paul Keating as Australian Federal Treasurer scrapped negative gearing in 1985 and then, two years later, reversed his decision and reinstated it in 1987.

And that was because the end to negative gearing benefits caused a shortage of housing across Australia and rents rose sharply.

It’s time for Australian politicians and journalists to stop obsessing over side issues like negative gearing and focus on the core issues in the housing industry – which is the shortage of dwellings, the high cost of fixing that shortage and in particular the chronic under-supply of rental properties.

Australia is struggling with a number of crisis situations – a cost-of-living crisis, a housing affordability crisis and a rental shortage crisis.

Our beloved Prime Minister Anthony Albanese has declared on many occasions how much he cares about the plight of ordinary Australians in dealing with these issues.

But, as the old saying goes, actions speak louder than words – and that is particularly relevant to our elected representatives who love to stand before the media cameras and declare their concern for the people but fail to match their words with appropriate actions.

So, let’s look at how the Prime Minister has handled his personal housing market issues in 2024.

In May this year Albanese evicted a long-standing tenant in a property he owned in the Sydney suburb of Dulwich Hill.

At the time, the tenant declared he was shocked to learn he no longer had a place to live and had no idea he was going to be kicked out of his home of four years.

At the time the tenant said he had tried to seek clarification of the situation and why he had to leave but did not receive a response.

He said at the time: “It seems a little bit misaligned with the messaging Labor has been putting out ... about recognising how difficult it is for renters.”

He also said: “It’s a crippling blow for me right now. I have mixed emotions in calling this out. I voted for Albo at the last election and am broadly a supporter of his policies.”

So, PM Albanese, having got rid of the pesky tenant, then put the Dulwich Hill property on the market, with an auction scheduled for October.

This was a three-bedroom townhouse at 29B Lewisham St in Dulwich Hill which Albanese bought for $1.17 million in 2015 and was advertising for auction with a price guide of $1.9 million.

If it sold at that price, it would represent a 62% gain in nine years.

But then, at the last minute, the Prime Minister cancelled the auction and decided not to sell the property after all. He evicted his tenant because he said he wanted to sell and then decided NOT to sell.

Then, in the same week, it was revealed he had spent $4.3 million on a new home on the Central Coast north of Sydney.

This is Albo the battler we’re talking about, the guy who loves to talk about his tough working-class roots and growing up in a housing commission environment.

Albanese said he planned initially on leasing out the property with views over Copacabana Beach, with estimates he will pocket between $2000 and $2500 a week in rental income.

A Labor MP, who declined to be named, said the purchase was “not a great look” for Albanese, who will have to fight hard to hold on to government at the next federal election.

Responding to claims the purchase was a bad look in a cost-of-living crisis and a housing market crisis, Albanese, who earns more than $600,000 a year, said he knew “what it is like to struggle”, referring to his upbringing in public housing in Sydney’s Camperdown.

“I am much better off as Prime Minister. I earn a good income. I understand that,” he said.

Columnist Dennis Shanahan wrote in The Australian: “There are two unequivocal things to say about Anthony Albanese’s decision to buy a $4.3 million cliff top, ocean view home on the NSW Central Coast. The first is — good on him. Well done for living the Australian dream of home ownership and getting there on his own.

“The second is this — this has to be the dumbest, most damaging piece of political tone deafness and timing since Tony Abbott appointed Prince Philip as a “Knight of the Order of Australia” in the Australia Day honours’ list in 2015.”

Shanahan wrote: “No matter what Albanese says to justify the purchase, it’s a bad political look that makes him appear out of touch with people renting and trying to buy their own home. It also raises the immediate thought that it’s a retirement parachute for after the next election.”

Meanwhile, on the same day as the $4.3 million purchase was revealed, it was the AGM of Commonwealth Bank – which reported that more and more customers are feeling the pinch from the cost-of-living crisis.

Commonwealth Bank chief executive Matt Comyn revealed huge numbers of Australians are falling behind on their mortgage repayments.

He told shareholders the bank has offered tailored hardship payment arrangements to 132,000 customers over the past year.

Comyn said: “Households are continuing to find it very challenging.”

But certainly not the household of our battler Prime Minister. Albo is doing very well indeed.

He’s just paid over $4 million for a home he won’t be living in and he has decided he doesn’t need to sell his $1.9 million investment property in Sydney to afford it.

And that’s perplexing news for the tenant he evicted on the grounds that he needed to sell the property, before subsequently changing his mind.

Residential real estate abounds with fallacies and misconceptions, mostly created by dishonest politicians, biased journalists and economists who don’t understand property.

One of the biggest is the one that claims that so-called prime property shows the best capital growth.

A year ago I attended a national conference for real estate professionals at which a keynote speaker expressed the view that you had to buy “prime” to get good capital growth – and indeed proclaimed that if you couldn’t buy prestige property you shouldn’t buy at all – or at least wait until you could afford something in the higher price ranges.

I had to challenge that view in question time because everything I’ve observed over four decades in real estate research absolutely contradicts this notion.

I was astounded that something presented as a real estate expert could make such an unsupportable claim and give such terribly bad advice.

It’s amazing how many people still cling to this out-dated and plainly inaccurate view of real estate, which is emphatically contradicted by all the evidence.

Many still believe that prime out-performs affordable, that the closer to the CBD the stronger the capital growth, that capital cities outdo the regions, and that the biggest cities show better growth over time that the smaller ones.

All of those opinions are fallacies. They’re just plain wrong.

Whether you examine the past quarter, the past year, the past three years, the past decade or the past 20 years, you will find compelling evidence that the regions have outperformed the capital cities, that the biggest cities have under-achieved, that affordable areas have excelled on capital growth – and that proximity to the CBD is utterly irrelevant in real estate investment.

And you can add another misconception that increasingly is being proven wrong – the one that says houses on land show better capital growth than apartments.

An example of what the research shows is provided by PropTrack which earlier this year examined how much dwelling values had grown in the four years since Covid disrupted property markets.

The leading jurisdictions for price growth were, in order, Regional Queensland, Regional SA, Adelaide, Brisbane and Perth.

The bottom ranking markets among the capital cities and state regional markets were Sydney and Melbourne.

PropTrack also looked the local markets with the highest growth over that four-year period and found that all of the Top 10 locations were regional or outer-ring areas of the smaller capital cities. The cheaper areas of Adelaide and Brisbane were most prominent for high capital growth, as well as regional areas of Queensland and South Australia.

Now, all of that is good news for most people approaching property investment who can’t afford to buy in those higher price brackets – because it means you don’t need to buy expensive homes to do well in real estate.

The typical investor I encounter wants to buy a property below $500,000 because they can’t afford to go higher.

The really good news is that buying affordable real estate in good locations is a win-win-win situation: a lower buy-in price, a higher rental yield and good prospects for capital growth.

We call this kind of real estate The Cheapies with Prospects.

Let me give you just one example of how Cheapies with Prospects locations can deliver the most spectacular capital growth.

Many times in the past few years I have made the observation that the cheapest houses in capital city Australia were located in the affordable northern suburbs of Adelaide – specifically in the local government area of Playford.

A few years ago many suburbs had median house prices in the $200,000s – and , let’s face it, this was seriously downmarket real estate.

In the past 12 months these suburbs have delivered extraordinary capital growth.

Most suburbs in the City of Playford have grown more than 20% in the past 12 months, seven suburbs which have lifted over 30% - including Elizabeth North up 33%, Eyre up 38%, Davoren Park up 41% and Elizabeth South up 55%.

In Davoren Park, the median house price three years ago was just $190,000 and now it’s $460,000. Typical houses in Elizabeth North cost $195,000 three years ago and now they’re $425,000.

There’s been similar spectacular price rises right throughout this precinct in the affordable north of Adelaide.

Keep those figures in mind next time someone tells you that you have to buy expensive houses in prestige areas to get the best capital growth.

There’s endless commentary about housing affordability in Australia but very little awareness that the fundamental issue is the high cost of creating new homes – and that our politicians are the cause of the problem.

The value of dwellings across the nation is underpinned by the cost in building new ones – and, in Australia, that cost is incredibly, ridiculously high.

And it’s high because of the policies of our elected representatives, at all levels of government, but particularly state government politicians.

Right now, after massive increases in building costs in recent years, you cannot build a new house in Sydney, for example, for less than half a million dollars.

A new study has found that the minimum cost of building a Sydney house is $2,300 per square metre – and based on the average size of a new house in New South Wales, that means the cheapest you can build the standard brick and tile house is $550,000.

Now, Sydney is the most expensive capital city in Australia to build a new home, but it’s not significantly cheaper elsewhere.

Research published earlier this year by Master Builders Australia found that the average cost of building a new house nationwide was $490,000 – having increased 53% in the past three years.

Keep in mind that that figure does not include the cost of the land – just the construction cost for the average brick and tile new house.

Master Builders said the cost of building homes had been inflated by higher government taxes, new government regulations which have added massively to the cost of construction, bureaucratic delays in getting building approvals, the increasing cost of materials and the shortage of tradespeople.

Tradies are in short supply primarily because so many are now working on big-ticket government infrastructure projects and are no longer available to work in the home building industry.

Keep in mind, all the figures I have quoted relate to the cost of construction and do not include land cost.

According to the recent study on Sydney home construction costs, the average price of vacant residential land in Sydney is over $640,000. However, it depends on where you buy land and you may have to pay far more than that, especially in established suburbs.

It means that establishing a new house on a block of land can typically cost more than a million dollars in Sydney.

It’s cheaper, but still incredibly expensive, elsewhere in Australia.

I have had recent conversations with a number of builders and developers of residential estates – people doing projects in outer-ring areas of capital cities and in regional towns – and they all say the same thing: they cannot produce a new house on a (very small) block of land for less than $750,000.

I have also spoken to the head of one of the largest development companies in Queensland who says the biggest cost escalations in the residential property industry have been in building high-rise apartments.

The costs have risen so much that it’s unviable for this company to build apartments unless they can be sold for at least $1 million each.

We know from other reports that dozens of major apartment developments have been cancelled because the cost of construction is too high to make them viable.

These outcomes speak to all the major issues afflicting residential property at moment – the shortage of new dwellings, the serious shortage of rental homes and rising rents, and the overall affordability issue.

For those facing the high cost of building new homes in Australia, the reality is that (depending on location with Australia) between 35% and 50% of the cost is government taxes, fees and charges.

All levels of government – local, state and federal – treat the housing industry as a cash cow. In other words, they milk the housing industry for taxation revenue, while claiming to care about the high cost of housing.

They have further inflated the costs of creating new homes by passing laws that change the design of homes – theoretically to make them safer, more accessible or more energy efficient. These imposed design changes have added massively to the cost of building dwellings.

The new construction code imposed by our elected representatives, alone, has added up to $40,000 to cost of building a new house in Australia.

The same problems exist everywhere in Australia. That includes in Canberra, where housing has become a major issue in the lead-up to the ACT election.

A peak body for residential housing wants the next ACT government to implement a four-year moratorium on new regulation and taxes on home building, to give the industry a chance to recover and deal with the shortages.

The Housing Industry Association ACT also wants the government to relax planning rules across some of the territory's residential zones to allow for larger homes and higher density.

It says the ACT is failing "across almost every housing metric".

He pointed to a reduction in residential dwelling commencements, the increased costs to service mortgages and low rental vacancy rates.

The HIA says: "The private housing market has been squeezed by a lack of shovel-ready land, and an explosion in regulation, red tape and taxation. Yet, at the same time as the private construction and rental sectors are constrained, there has been a failure of government to meet its obligations for public housing.

"The ACT has a housing emergency. To do nothing other than continue with the status quo is not an option."

Now, those comments are directed at the dire situation in Canberra, but could be applied equally to most cities across the nation.

Politicians have created the problems and are clueless about how to resolve the issues that are causing prices and rents to rise, and the cost of building new homes to escalate.

How relevant is population growth data for people choosing where to buy?

According to the theories espoused by some, the best places to buy are the ones with the highest population growth.

But the evidence suggests otherwise.

For example, take a look at the latest data on population growth across Australia, published by the ABS recently.

It shows that one of the states with the highest population growth has been one of the worst performers recently on price growth, while one of the states with the lowest population growth has been one of Australia’s best performers on price growth.

For the record, the ABS data on population for the 12 months to the end of March 2024, shows that the national population is now above 27 million - 27,122,411 to be exact.

Over 600,000 was added to the national population in that 12-month period which, while very high growth, was less than the number added in the 2023 financial year.

83% of the national population growth has been due to overseas migration. In 12 months ended March 2024, Australia added over 509,000 net migrants (made up of 718,000 people immigrating to Australia and 209,000 emigrating).

Western Australia recorded the highest percentage growth in the 12 months to March, with its population rising 3.11%, compared to the national average of 2.32%.

And that, of course, does align with house price outcomes, with Perth recording the highest price growth among the capital cities and WA achieving the highest price rises among the state and territory regional markets.

The next highest annual growth in population was in Victoria, which rose 2.72%. But property prices haven’t been rising in Melbourne or Regional Victoria – in fact, they’ve gone backwards a little in the past year. So, high population growth, particularly from overseas migrants, has not pumped up property markets in Victoria.

One of the weakest population growth rates has been South Australia, up just 1.48%, but Adelaide has been achieving exceptional growth in house prices and unit prices, bettered only by Perth. And Regional SA has consistently been an out-performer on property price growth as well.

Clearly, based on this evidence, population growth in not the big factor.

It may A FACTOR, one of a number of factors which can influence property markets, but clearly it’s not the big driver.

The latest Australian Bureau of Statistics data has recorded a decline in the number of dwelling approvals across the country.

Total dwelling approvals saw a drop of 6.1 per cent in the month of August, at a time when Australia needs to be building a lot more homes.

According to ABS head of construction statistics, Daniel Rossi, private dwellings excluding houses were the main contributor to the decline – in other words, there has been a big decrease in approvals for attached dwellings like units and townhouses.

This has resulted in a 16.5 per cent fall in approvals for those types of attached dwellings.

Furthermore, the value of total residential building fell 6.7 per cent to $7.96 billion while the value of non-residential building rose 11.5 per cent to $5.30 billion.

The numbers suggest that there’s a lot of construction projects happening in Australia but not enough of them are new dwellings in a nation that has a severe shortage.

A lot of government resources are being directed into big infrastructure projects, and a lot of tradespeople are working on these projects, when the nation really needs these resources to be going into building new homes.

One of the measures of construction activity in Australia is the number of cranes on the skyline.

The infrastructure boom has pushed the total of non-residential cranes across the nation to a record 370, while slumping investment in new housing has reduced the number of residential cranes to a two-year low in the latest report on the country’s construction sector.

The infrastructure boom is keeping construction costs high and making it harder for private projects to stack up, according to Domenic Schiafone, the head of research for quantity surveying firm RLB, which produced the report.

Other data shows that in the 2024 financial year, the number of new homes built in Australia fell 9% to the lowest level since 2011.

If the current rate of building continues, Australia will build around 800,000 over five years, when the Federal Government target is 1.2 million new homes – a figure that was never realistic and looks, now, increasingly fanciful.

HIA chief economist Tim Reardon agrees there are many challenges making dwelling development difficult. According to Reardon, rising taxes for foreign investors and rising regulatory costs generally are negatively impacting building approval figures.

Reardon notes that house approvals in Perth and Brisbane are faring much better than in Sydney and Melbourne.

He says confidence in the Melbourne new home market has been adversely impacted by two new taxes, while policy debates generated by recent Federal Government actions are making it harder for the industry to achieve the national target of 1.2 million new homes.

Reardon says: “Recent discussions on negative gearing and capital gains tax arrangements for residential property are undermining confidence in new home building. The government’s focus should be on lowering the taxes, regulatory costs and excessive charges that make up as much as 50 per cent of the final cost of a house and land package.”

That’s worth repeating – that, in some parts of Australia, up to half of the cost of a house and land package comprises the taxes, fees and charges imposed by government.

The official figures show that total housing starts for the year to June totalled about 159,000, which is 81,000 homes short of the 240,000 the country needs to be building each year to meet the government’s increasingly aspirational 1.2 million-home target over the five years to 2029.

If building continues at this pace, Australia will build less than 800,000 new homes over the next five years – 400,000 short of the government’s target.

The rise and rise of the unit market is keeping the Greater Sydney market busy, although below the exceptional levels seen in some of the other market jurisdictions across Australia.

Unit markets are considerably more positive than house markets in our most expensive capital city and the market share of attached dwellings continues to rise.

In our latest analysis, well over half of all residential sales across Greater Sydney are attached dwellings.

In most of the Greater Sydney municipalities where sales activity is strong, it’s the unit markets that are most active. Outer ring house markets are generally subdued, suggesting that those seeking affordable options are choosing apartments and townhouses.

The dominance of attached dwellings in Sydney market performance can be seen in various metrics, resulting from our most recent analysis of activity.

While 45% of locations with house markets have positive rankings in our latest analysis, 67% of unit markets are positive. This includes 24% of house locations classified as rising markets, in contrast to 37% of unit locations.

This coincides with further evidence that a growing share of dwelling sales in the Greater Sydney market are attached dwellings.

Comparing the June Quarter results for the past four years, the market-share of units was 48% in 2021, 50% in 2022, 52% in 2023 and 54% in 2024.

So the latest quarter has shown a resurgence in sales activity in Sydney, inspired by rising demand for attached dwellings.

In the City of Sydney LGA, two-thirds of suburbs have positive ratings, headed by the unit markets in Sydney CBD, Surry Hills, Waterloo, Chippendale, Darlinghurst, Elizabeth Bay and Redfern – all rising markets.

In the Canterbury-Bankstown LGA, which has recorded a steady rise in sales volumes over the past 18 months, 60% of locations have positive ratings, most of them unit markets. Those with rising sales activity include the unit markets in Bankstown, Belmore, Canterbury, Campsie, Lakemba and Wiley Park.

The City of Parramatta fits this pattern also. Two-thirds of markets have positive ratings and 10 of the 13 ranked as rising are unit markets – headed by North Parramatta, Sydney Olympic Park, Toongabbie and Westmead.

Top end municipalities that continue to pump strongly include the Woollahra LGA, where there have been steady increases in quarterly sales over the past 18 months. The apartment markets in Double Bay, Vaucluse and Edgecliff are all rising, while those in Rose Bay, Woollahra and Paddington have consistent buyer demand.

The City of Randwick is also very consistent with its sales levels, boosted by rising activity in the unit markets of Kensington and Matraville, the house market in Randwick, and both houses and units in Maroubra. In the City of Waverley, another place with steady quarter-by-quarter sales, the leading locations with rising sales are the unit markets in Bondi, North Bondi, Bondi Junction and Waverley.

In the outer-ring areas, the City of Penrith at the western fringe of Greater Sydney has recorded a recent upsurge in market activity and six out of ten markets have positive rankings. Rising locations include the house markets in Jamisontown, Kingswood, Penrith, St Marys and Werrington, as well as the unit markets in Colyton, Kingswood and St Clair.

But the City of Liverpool is where house markets are doing best, amid a recent upturn in sales volumes – led by Green Valley, Moorebank, Prestons and Wattle Grove. The unit market in the central suburb of Liverpool is also notably strong.

The Regional New South Wales market overall is solid, without excelling at the levels seen in other regional areas like Queensland and Western Australia, but with individual out-performers.

There is hesitancy in the Regional NSW market overall. It has a high number of locations where buyer activity is lukewarm and price performance below the levels seen elsewhere in the nation.

It’s noteworthy, however, that Regional NSW has seen better performance in its unit markets than its house markets, which is part of a national trend.

Overall sales levels have improved, continuing a pattern of recovery over the past year, but remain well below the peak levels of 2021. Regional NSW saw a major decline in its market in 2022 and early 2023, with signs of gradual revival seen since mid-2023.

Amid this overall patchy performance, there are some standout growth markets, based on individual Local Government Areas including those in the Wollongong, Newcastle and Albury regions.

The Wollongong region continues to be a state-leading star. The City of Wollongong LGA has an above-average number of rising locations and the nearby Shoalhaven LGA continues to thrive: quarterly sales over the past 18 months have been rising steadily, showing one of the best patterns of growth in the nation. The Shellharbour area is also part of this region’s growth.

Newcastle remains an outstanding market and neighbouring LGAs including Lake Macquarie, Port Stephens and the Hunter Valley municipalities all have busy markets.

The Mid Coast LGA has delivered steady increases in market activity over the past year, quarter by quarter. Both Forster and Tuncurry have rising markets and Taree is highly consistent.

While those markets are heading into over-drive, some of the high-profile regions of NSW have not yet got out of second gear.

The Central Coast still has a degree of uncertainty; Byron Bay is showing signs of recovery, after a high peak in 2021 and a deep post-boom trough in 2022 and 2023, but remains well peak the 2021 boom levels; and both Coffs Harbour and Port Macquarie have had patchy results over the past year, with indications of recovery in the latest quarter.

The Tweed LGA is showing signs of joining the boom experienced north of the border in the Gold Coast region, without yet being fully on board.

Elsewhere in Regional NSW, Dubbo, Wellington, Orange, Gunnedah, Inverell and Tenterfield are classified as rising markets; Goulburn and Mudgee are rated as recovery markets; and Armidale, Glen Innes and Parkes stand out for consistent sales activity.

Are you ready to capitalise on Australia’s next big wave of growth?

Join us for an exclusive webinar hosted by Tim Graham of Hotspotting.com.au with special guest Zen Christofi of Reventon as we dive into Second-Wind Markets: Strategies for Savvy Investors.

In this insightful session, you’ll discover: What are Second-Wind Markets?

Gain a clear understanding of post-boom correction phases and why some markets are positioned for renewed growth.

National Overview of Second-Wind Markets

Explore key factors driving the resurgence of these markets, from interest rates to housing shortages and immigration trends.

Real-World Case Studies

Investment Strategies Learn expert strategies on how to time your entry into second-wind markets and balance capital growth with rental yields.

Exclusive Insights from Zen Christofi Zen Christofi will share his expert analysis of these markets and discuss actionable strategies for savvy investors like you.

What you will learn: Expert insights into Australia’s emerging second-wind real estate markets. Proven strategies for making informed, high-growth investment decisions.

To contact Zen and his team at Reventon, please visit: www.reventon.com.au

Household wealth in Australia keeps rising and the key reason for that is residential property – which accounts for 68 per cent of the total wealth of Australian households.

New data from the Australian Bureau of Statistics (ABS) shows that total household wealth has reached $16.5 trillion.

Now, that number doesn’t mean much to the average observer, so here are some other numbers that give it some context.

That household wealth figure represented a 1.5 per cent rise in the June quarter and the current level of the highest on record.

It’s 9.3 per cent higher than a year ago, and it means the overall level of household wealth in the nation has increased for seven consecutive quarters, driven primarily by residential land and dwellings.

Dr Mish Tan, head of finance statistics at the ABS, notes that house prices have continued to rise across most states and territories, despite high interest rates, and said this largely reflects ongoing housing supply constraints.Property assets reached an unprecedented level of $11.2 trillion as of 30 June 2024, making up around 68 per cent of household wealth. The surge in household wealth over recent years has largely been attributed to rising property prices.

Households also hold $1.72 trillion in cash and deposits or 10.4 per cent of their total net worth, alongside a record $3.94 trillion in superannuation assets.

Now, one of the ways that residential real estate has pumped up household wealth in the past year or so, is the steady rise in the number of suburbs across Australia with a median price above $1 million.

According to CoreLogic, the number of Australian suburbs with a $1 million median price for either houses or apartments has reached a new record high.

Over the 12 months to September, 218 more suburbs surpassed a $1 million median for houses or apartments. Australia now has 1,257 suburbs with a median house value at or above $1 million, as well as 140 suburbs with a median apartment value at the same level.

And if you want to discover which suburbs are most likely to join the Million Dollar club in the near future, get yourself a copy of our newest report – the national Top 10 Million Dollar Hotspots report.

Hotspotting has published this report in conjunction with multi award winning buyers agency Propertybuyer – and it provides valuable insights into where to buy real estate in locations where the median price is below $1 million, but expected to surpass the milestone figure in the not too distant future.

ANZ, the worst forecaster on property price outcomes in the nation, has just published its forecasts for what will happen with house prices in 2024.

Yes, that’s right. They’ve published, in October, forecasts for house prices this year, a couple of months before the end of the year.

Why have they done this? Because it’s the only chance ANZ has of getting it right with its property price forecasts.

Essentially what it has done with these “predictions” is take the existing situation and extrapolate it two months into the future.

So, you will be amazed to learn that they’re predicting that Perth, Adelaide and Brisbane will lead on price growth in 2024.

You’d pay good money for insights as sharp as that, right?!

The big four banks, collectively, have terrible track records in forecasting property price outcomes.

They are ALWAYS – and I do mean ALWAYS – wrong, but usually they are spectacularly wrong.

But ANZ bank is the worst of them.

At the start of 2024, it predicted house prices would fall across the nation in 2024 – by as much as 15%.

They did the same at the start of 2023 – forecasting massive decline in house prices.

Of course, it’s now clear that they got this horribly, horribly wrong – because they just don’t understand real estate dynamics.

Their reason for expecting prices to collapse in 2023 and again in 2024? Because of high interest rates.

Essentially that’s all they have in their kit bag of real estate knowledge.

Interest rates high or rising? Property prices fall, according to the ANZ mindset.

Except they don’t – and they didn’t.

ANZ has a few problems at the moment. It’s been taken to court, successfully, by federal authorities like ASIC because it’s not only incompetent, it’s an organisation with dodgy ethics.

But once they sort out their legal issues, they might turn their attention to sacking their senior economists who continually pump out ridiculous reports claiming to be research – including absurdities like forecasting property price outcomes for the calendar year, just two months before the end of the year.

The report, rather comically, is titled “Property Insights” – but there is nothing insightful in this report or anything else emanating from ANZ any time in the past several years.

The biggest paradigm-changing trend in Australian real estate, the rise and rise of apartments, is confirmed by the latest price data from the usual suspects – and is reflected in our choices for the latest edition of our most popular report, the National Top 10 Best Buys report.

The latest price data from CoreLogic shows that unit prices are rising faster than house prices.

While news media, in its predictable fashion, focussed on the perceived negatives in the CoreLogic Home Value Index published in October, my analysis of the figures is that they provide further evidence that rising demand for attached dwellings is creating out-performance on price growth.

Perth still leads on growth in house prices, but the numbers for growth in unit prices are considerably stronger, both for the past month, the past quarter and the year to date.

According to CoreLogic, Perth prices rose 1.6% in September for houses but 2% for units.

In the September quarter, Perth house prices increased 4.6% but unit prices were up 6.2%.

And, for the first nine months of 2024, house prices are up 17% but unit prices more than 20%.

It’s the same for one of the other hot city markets, Adelaide.

House prices in Adelaide has recorded strong rises in the month of September, the September Quarter and the year to date, but unit prices have increased more in each of those time frames.

The price outcomes are even more emphatic in Brisbane: house prices rose 2.4% in the September Quarter, but unit prices rose 4.8%, exactly twice as much. And the year to date growth numbers are 10% for houses but 14% for units.

In both Sydney and Melbourne, which have not been matching the smaller cities on growth, the numbers are nevertheless stronger for units than for houses.

And nationally, median prices grew 0.4% for houses but 0.6% for units in September, while in the September Quarter houses were up 1% but units 1.2%.

The differential is greatest in the Combined Regional markets, with units outperforming houses in the month, the quarter, the year to date and in the past 12 months.

And that holds true for most of the individual state regional markets, notably Western Australia, New South Wales and South Australia. In Regional Queensland, where many regional cities have highly active markets, the numbers are fairly even.

Overall, these numbers are the latest piece of evidence that the old paradigm of real estate, that houses always outperform units on capital growth, is changing and in many locations HAS changed.

As we comment in the report we recently published with marketing company Nuestar, the one we call The Rise and Rise of Apartments, there is growing buyer demand for attached dwellings across Australia.

Units now accounts for more than half of all sales in the Sydney market and they have a growing market share in Melbourne, Brisbane and Canberra as well.

In the booming Perth market, where houses are no longer the cheapest in capital city Australia following massive price growth recently, more and more buyers are pivoting to the more affordable and often better located unit products in the market.

And now this compelling trend in national real estate is a big influence on our choices to the nominated locations for the new edition of the National Top 10 Best Buys.

Many of the nation’s strongest locations for unit demand are prominent in this report – as well as some of the most vibrant house markets in key locations across Australia.

Join us for an insightful and essential webinar hosted by Terry Ryder, Founder of Hotspotting, and Corinne Bohan, Managing Director of Image Property, as they dive into the crucial role of professional property management in today’s rapidly changing rental landscape.

In this engaging session, you'll discover:

Building Your Winning Team: Learn why investors must focus on assembling a strong management team before growing their property portfolio and how a first-rate property manager can be a game-changer, especially in the face of evolving regulations.

Navigating the Rental Market: Gain expert insights into the latest rental market trends, including the impact of rising rents, affordability ceilings, and the increase in shared living arrangements.

Discover how to effectively screen tenants and ensure compliance with new legislation.

Maximising Returns with Dual Living: Explore the pros and cons of dual living and co-living properties.

Understand the financial benefits, potential pitfalls, and what to consider before diving into this growing trend.

Proactive Maintenance: Learn how proactive property maintenance can help you avoid costly repairs, and hear expert tips on building a solid relationship with your property manager to ensure your investments are well cared for.

Whether you're an experienced investor or just starting, this webinar will provide you with the knowledge and tools to optimise your property management approach and stay ahead in a competitive market.

To connect with Corinne and her team, please visit www.imageproperty.com.au

The new Spring edition of The Price Predictor Index provides emphatic confirmation of the most compelling trend in Australian real estate: the escalating demand for apartments and their challenge to houses on capital growth performance.

We have been speaking about the rise and rise of apartments for the past 18 months and there is a growing body of evidence which confirms that more and more buyers are opting for attached dwellings: units, apartments and townhouses.

Our analysis of sales activity data for the latest quarter for the Spring edition of The Price Predictor Index reveals that this trend is dominating markets across Australia.

For example, there is a stark contrast in the Sydney market. In simple terms, unit markets are pumping and house markets are not - and the market share of attached dwellings continues to rise.

In most of the Greater Sydney areas where sales activity is strong, it’s the unit markets that are most active. Outer ring house markets are generally subdued, suggesting that those seeking affordable options are choosing apartments and townhouses.

The dominance of attached dwellings in Sydney market performance can be seen in various metrics. While 45% of locations with house markets have positive (rising, recovery, consistent) rankings in this analysis, 67% of unit markets are positive.

This coincides with further evidence that a growing share of dwelling sales in the Greater Sydney market are attached dwellings. Comparing the June Quarter results for the past four years, the market-share of units was 48% in 2021, 50% in 202, 52% in 2023 and 54% in 2024. There’s a pretty clear pattern emerging there.

Sydney’s experience, with attached dwellings outperforming detached, is part of a strong national trend that is also evident in other cities and some of the regional jurisdictions.

In the Brisbane City LGA, elevated demand for units is driving overall activity. In Melbourne, which overall continues to under-achieve, a key exception is provided by inner-city unit markets. And Canberra is experiencing a similar scenario.

While just over half of Canberra markets overall have positive ratings, 78% of unit markets have rising, recovery or consistent classifications based on sales activity trends. Of the 36 unit markets in our Canberra analysis, only 3 have negative ratings.

While only 35% of house markets are classified as rising markets, 61% of unit markets in Canberra have this rating.

Affordability is likely a major driver of this trend. Canberra has a median house price close to $1 million (PropTrack data), higher than Melbourne and Brisbane. But its median unit price is $605,000, notably cheaper than Melbourne, Brisbane and Sydney, and on a par with Adelaide. The market share of units is rising year by year and attached dwellings now account for 44% of dwelling sales in Canberra, compared to 41% in 2021.

In booming Perth, the strongest markets in Perth now are well-located locations with a major presence of attached dwellings.

While the most popular house markets for home buyers and investors (mostly those at the affordable end of the market) are a little less buoyant than earlier in the Perth up-cycle, the focus is switching for affordable units.

Perth started this boom with a reputation as the most affordable capital city housing market. After a couple of years of stellar price growth, that’s no longer the case. Perth is now well above Hobart and Darwin with its median house price and challenging Adelaide.

Perth now has a median house price of around $800,000, but its median unit price is in the low $500,000s, still well below that of Hobart and Adelaide.

When the bargain suburbs have house medians above $500,000, the big attraction that caused the stampede starts to fade. So now buyers in Perth, increasingly, are looking at unit markets, which are less competitive than the house markets.

So now units are capturing a growing market-share in Perth, similar to the scenarios in Sydney, Melbourne, Brisbane and Canberra.

And units are out-performing.

In the new Spring edition of the Price Predictor Index, 29% of Perth house markets are3 classified as rising but almost 50% of unit markets are ranked as rising, based on trends with sales activity.

Clearing, the trend with more and more buyers opting for attached dwellings over detached houses, is gathering momentum.

It’s a major paradigm shift in Australian real estate – and at Hotspotting we believe this trend is here for the long term.

Affordability is the most-debated and the most confused issue in residential real estate.

While the rental shortage and rising rents occupies the minds of many, the property issue that occupies the most space most often in news media and in the minds of Australian consumers is housing affordability.

It has been this way for years, indeed for decades. And while the so-called Great Australian Dream is often declared dead, with young people doomed to a lifetime of renting, the evidence suggests otherwise.

I recently finished working on a report with financial comparison website Canstar which demonstrates that the Dream is very much alive.

The Deposit Stars report shows that there are attainable options for young buyers in all our city and regional markets, including the biggest and most expensive cities.

And the finance data indicates our property markets remain as active as ever.

A report from the Housing Industry Association in August 2024 noted that “various segments of the housing market are increasingly active, with lending to first-home buyers, owner occupiers, and investors increasing in the first half of 2024”, based on the latest ABS lending data.

HIA economist Maurice Tapang said: “This increase in lending is partially driven by first home buyers. The number of loans issued to FHBs in the June quarter was 5.8% higher than the March quarter.”

This reflects ABS data on the broader market encompassing all types of residential real estate loans up to the end of June 2024.

One of the reasons home ownership is often declared beyond the reach of the average consumer is that most reports are based on unrealistic parameters.

As I comment in the Deposit Stars report, most analysis on affordability is based on the size of a 20% deposit to buy a house at the median price in our major cities and how long it would take to save such a deposit.

These reports preclude the possibility of smaller deposits, particularly with the help of government programs.

They overlook the reality that most people entering the market for the first time buy houses in the lower price ranges well below the city’s median price.

And they usually ignore the preference of many buyers for attached dwellings – apartments, townhouses and units - and not only because they’re cheaper.

Many of the locations featured in the Canstar report reflect a growing phenomenon in Australian real estate: the rise of attached dwellings as the home of choice by more and more buyers.

A range of cohorts are opting increasingly for units and townhouses, including downsizers, lifestyle buyers, migrants and first-home buyers.

One of the features that draws growing numbers to apartments is location appeal. Not only do attached dwellings allow people to access property in good locations at cheaper prices than houses, but the average unit is better located than the average house.

The “Measuring Home Price Differences” report by Infrastructure Victoria found that units consistently trump houses on proximity to desirable features.

The report says: “Units are located closer to selected infrastructure types, on average, than houses and townhouses.”

This is one of multiple factors driving higher demand for units – challenging the dominant paradigm of real estate (that houses always outperform units and townhouses on capital growth).

That is undoubtedly changing.

Recently Ubank, which is a division of National Australia Bank, published a survey which found more than half of Gen Z and Millennials who don’t own a home are looking to make a move on the property market within the next five years.

56 per cent of survey respondents – all Australian Gen Z and Millennials between the ages of 18 to 43 – aim to purchase their first property within the next five years.

Nine out of 10 respondents agrees that purchasing a home was one of their goals in life – although most acknowledged it won’t be easy.

In addition to all that, research from the Commonwealth Bank confirms that ownership remains an ambition and that the number of first-time buyers going it alone is growing.

According to data from the big four bank, 40 per cent of first home buyers purchased their property alone in the first six months of 2024 – without going in on the purchase with a partner, friend, or family member.

That’s a jump from the 35 per cent of first-time buyers doing the same in 2019.

So there is compelling evidence that home ownership not only remains a primary goal for young Australians, but that it is being achieved in growing numbers.

In this episode of the Hotspotting Podcast, Tim Graham sits down with Arjun Paliwal, the Managing Director of Investorkit and a two-time REB Buyers Agency of the Year winner.

Arjun shares insights on his unique approach to property investment, focusing on "buying against the grain."

Here are some of the key topics discussed:

Episode Highlights: Introduction to Arjun Paliwal: Arjun kicks off by talking about his journey in the property industry, how he scaled Investorkit, and the importance of innovation in finding investment hotspots.

The Concept of 'Buying Against the Grain': Arjun explains what it means to buy against market trends, how it can lead to high returns, and why this strategy is not for the faint-hearted.

Leveraging AI in Property Investment: Learn how Investorkit utilizes over $500k annually in AI technology to identify growth opportunities in the property market.

Challenges and Successes: Arjun shares stories of both successful investments and the challenges faced when buying against the market tide.

Practical Advice for Investors: For those interested in adopting this strategy, Arjun offers practical advice on how to get started and what to look out for.

The Future of Property Investment: Arjun and Tim discuss the future of the property market in Australia, with insights into emerging trends and what investors should be prepared for.

To Connect with Arjun & his team, please visit www.investorkit.com.au

Australian real estate has been characterised by three different types of shortage which have put upward pressure on rents and prices.

Those are the shortage of rental properties, the shortage of new dwellings under construction and the shortage of homes listed for sale.

While the shortage of rental homes and the under-supply of new homes persists, there has been recent improvement in the number of homes listed for sale by vendors.

SQM Research finds that the number of residential property listings nationwide rose by 8% in August, bringing the total to almost 250,000 properties, up from 231,000 recorded in July.

In annual terms, listings of homes for sale are now 11% higher than a year.

Nationally, new listings recorded a 12% surge in August, with over 73,000 fresh property listings entering the market.

Sydney new listings were the highest level ever recorded for the month of August, according to SQM.

It reports that total listings of homes for sale in August recorded significant increases across most major cities.

Even boom cities like Perth, Brisbane and Adelaide recorded major increases in the number of properties for sale.

Indeed, Perth had an 11% monthly increase in listings, reaching over 13,000 properties for sale – BUT Perth remains the only city with a significant yearly decrease, still 21% below August last year.

Canberra up 11% and Adelaide up 9% both showed solid monthly growth in listings – and Canberra experienced the largest yearly increase of all major cities at 32%.

Brisbane reported a moderate monthly increase of 7% in August, bringing the total to a little over 18,000 listings – which is 3.3% higher than a year ago.

These improvements in listings of homes for sale – which may be inspired by the belief that Spring is a good time to sell – may take some of the pressure off dwelling prices, particularly if the rise in action by vendors continues in September and October.

State governments across Australia have no meaningful policies for easing the chronic under-supply of rental properties – but they do have a talent for using the rental shortage as an excuse to raise extra revenue from the housing market.

One of the primary tactics they use is to scapegoat a section of the community and blame them for the problem that they, the politicians, have created – and then hit the demonised group with new taxes and pretend that they’re doing it to deal with the rental shortage.

The worst offender in this regard, although not the only one, is the State Government in Victoria.

Victoria, which has the highest property taxes in the nation, is by far the worst place in Australia to own an investment property – and the State Government there continues to work hard to confirm that reputation.

Its latest move is to blame the rental shortage on property owners who use short-term letting platforms like Airbnb, rather than have permanent tenants.

Choosing to use short-term letting is a perfectly reasonable and legal thing to do – and there is considerable public demand for houses and apartments made available for holiday letting, as an alternative to expensive hotel rooms.

But the Victoria Government has decided to demonise owners to use Airbnb and other similar platforms so that they can hit them with a major new tax and raise some desperately needed revenue for a government that is strapped for cash.

They’re claiming it will fix the rental shortage, but of course it won’t.

Airbnb didn’t cause the rental shortage in Victoria or elsewhere in Australia – it’s a very minor part of a much larger problem, and curtailing it won’t create higher vacancies and lower rents for permanent tenants.

This has been confirmed by a number of university studies, including one by the University of Queensland which found that banning short-term letting would not make any significant difference to the rental shortage.

And RMIT University in Melbourne has come up with a similar finding.

An RMIT University expert says the Victorian short stay rental reforms won’t solve the rental housing crisis.

Dr Liam Davies, an urban planning expert from RMIT’s Centre for Urban Research, says the new powers granted to Victorian councils and owners corporations to restrict or ban short stay rentals are UNLIKELY to have a significant impact on the state’s housing crisis.

Dr Davies said the reforms will likely have minimal effect on overall rental affordability.

He says: “This change to short stay accommodation is likely to have positive benefits at a local level but may not significantly impact the state’s rental affordability issues.”

Dr Davies cautioned against expecting widespread changes to the rental market as a result of these policies.

He said it’s unlikely that all those Airbnb dwellings would be shifted to long-term rentals – so the effect of the reform will probably be minimal.

The most likely response of property owners faced with these new restrictions will be to sell – as many investor owners of Victorian properties have already done recently – thereby making the property shortage worse.

CoreLogic is one of Australia's leading sources of data on residential real estate matters, although increasingly overshadowed by other, smarter data organisations like PropTrack.

CoreLogic has lots of statistics about housing markets but when it comes to analysis and commentary, CoreLogic is very often a source of illogic.

Their problem, like so many companies that comment on Australian housing markets, is that they employ economists to analyse real estate and the outcome very often is kindergarten analysis.

Here’s a recent example:

According to CoreLogic’s Regional Market Update, property markets outside the capital cities are experiencing a slowdown in value growth because, they say, fewer people are moving from the cities to the regions and because of the elevated interest rate environment.

Regional markets saw dwelling values increase by 1.3% over the three months to July.

CoreLogic economist, Kaytlin Ezzy, said this means the pace of growth has eased from recent peaks.

She noted, however, that growth trends across Australia’s 50 largest regional markets have become increasingly diverse, including 11 regions which saw values rise by more than 3% in the quarter.

So here’s what wrong with that analysis, for want of a better word.

Firstly, they have made the common error of placing great significance on short-term data. The rate of price growth, overall on average across regional Australia, is less than it was a few months earlier, apparently, therefore they say that the market is declining.

But price graphs are seldom smooth and future months may see a return to higher price rises. It’s always unwise to declare a new trend based on one recent set of short-term figures.

Secondly, they claim internal migration to the regions is no longer happening as strongly as before. The latest Regional Movers Index, jointly published by the Commonwealth Bank and the Regional Australia Institute, strongly disagrees with that statement. It shows that Australians continue to relocate from Sydney and Melbourne to regional areas in large numbers.

Thirdly, the claim that elevated interest rates are causing a decline is farcically stupid. The RBA started lifting the official interest rate in May 2022 and it rose steadily (by a total of four percentage points) until November 2023. So interest rates have been elevated for over two years – and there has been no further rise in the past nine months – but now, according to Core Illogic, elevated interest rates are causing a decline in regional property markets.

And how does that theory sit alongside the reality that, according to Core Illogic, 11 regions recorded a rise of more than 3% in the latest quarter?

They say that “if you torture statistics enough, they’ll tell you anything you want to hear”.

That’s particularly true for economists who subscribe to the theory that everything that happens in residential real estate is caused by interest rate trends, notwithstanding lots of compelling evidence to the contrary.

The truth is that we still have a situation where many of Australia’s strongest property markets for price growth are in the regional areas, headed by boom regional centres like Bunbury, Mandurah and Geraldton in Western Australia, and Rockhampton, Toowoomba and Townsville in Queensland.

Regional Australia continues to provide the best options for investors seeking affordable prices, higher rental yields and good prospects for capital growth, provided you choose your location with care.

Perth is moving into a new phase in its property boom, with more and more buyers opting for units as houses become more and more expensive.

The latest sales data shows that the strongest markets in Perth are well-located locations with a major presence of attached dwellings.

While the most popular house markets for home buyers and investors (mostly those at the affordable end of the market) are a little less buoyant than earlier in the Perth up-cycle, the focus is switching to affordable units.

Perth started this boom with a reputation as the most affordable capital city housing market. After a couple of years of stellar price growth, that’s no longer the case. Perth is now well above Hobart and Darwin with its median house price and challenging Adelaide.

Perth now has a median house price around $800,000, but its median unit price is in the low $500,000s, still well below that of Hobart and Adelaide.

The evaporation of affordability in the Perth housing market can be seen is the rise in values in selected suburbs. Armadale, heavily targeted by investors and FHBs, had a median price of $250,000 three years ago and now it’s approaching $500,000. Seaside Rockingham had a median price below $400,000 at the start of 2021 and now its $630,000. Greater Perth has many similar examples.

When the bargain suburbs have medians above $500,000, the big attraction that caused the stampede starts to fade. So now buyers in Perth, increasingly, are looking at unit markets. While many house markets have been frenzied, with listings selling within days and prices rising by 20% or more a year, the unit markets are less competitive and prices have not yet taken off.

The City of Perth provides a case study. The median unit price for East Perth has risen 6% in the past 12 months while the suburb of Perth has increased 9%. Typical units are priced in the mid-$400,000s. Quarterly sales have been 406 490 599, showing a major lift in buyer demand recently.

In the City of South Perth, unit sales in both Como and South Perth are rising strongly, while in Subiaco quarterly unit sales have been trending higher for the past 12 months – the median unit price is heading towards $600,000, but that’s a third of the price of typical Subiaco houses. There’s a similar pattern in Victoria Park, where the median unit price has risen 11% but remains low at $400,000.

Upmarket Mosman Park provides a startling contrast between its house and unit markets: there have been identical sales numbers in the past year, but the median prices are $2 million for houses and $380,000 for units. Perhaps not surprisingly, sales volumes for units are rising strongly, but prices haven’t moved much as yet.

There are many other examples in the Perth market, which is now following patterns seen in other cities in the trend we call the Rise and Rise of Apartments.

Adelaide’s property market, one of the nation’s strongest in the past two years, has strengthened further recently.

ales volumes shows that market activity in the June quarter was the highest for Greater Adelaide since mid-2022.

The June Quarter sales levels represented a 25% increase on the March Quarter and were 10% higher than the same time last year.

This is despite the reality that listings of homes for sale across Adelaide are the lowest at any time in the past 15 years, according to SQM Research figures.

This continues Adelaide’s track record as a market with consistently high performance and helps to explain why it has been a challenger to Perth as the market with the highest price growth in the past two years.

Adelaide’s median house price rose 15% in the 12 months to August 2024, while the median unit price increased 12%, according to PropTrack data.

Only Perth has recorded higher annual price growth.

Across the Greater Adelaide market, suburbs with positive trends with sales activity outnumber those with negative ones by a factor of three to one.

The Greater Adelaide area has standout markets across all price ranges, including affordable municipalities like Playford and Salisbury, middle market areas including Marion and West Torrens, and more upmarket locations such as the Unley, Holdfast Bay and Charles Sturt LGAs.

The Playford LGA, which contains Adelaide’s cheapest suburbs, is the most popular precinct for buyers, with over 800 dwelling sales in the June Quarter. That was 31% higher than the same time last year – and a 53% increase on the March Quarter.

Most Playford suburbs have positive sales trends, either rising or consistent, with Blakeview and Davoren Park in particular standing out for their consistent buyer demand. The median house price for Blakeview has risen 16% to $550,000 in the past 12 months, while Davoren Park is up 33% to $440,000.

Davoren Park had a median house price of just $175,000 three years ago.

The neighbouring Salisbury LGA, another precinct targeted for its affordable homes, is also a strong performer with sales levels considerably higher than the March Quarter and also the same time in 2023. Rising markets in the City of Salisbury are headed by standout suburbs like Ingle Farm and Mawson Lakes.

The median house price for Ingle Farm was $380,000 three years ago and is now $655,000, after 19% growth in the past 12 months.

Another outer-ring location with outstanding numbers is the Mount Barker LGA, which has recorded the highest quarterly sales numbers in more than three years. The suburbs with strongly rising sales activity include Nairne and Mount Barker. Nairne’s median house price has risen 17% to $750,000 in the past 12 months.

Among the middle market areas, the West Torrens LGA is a notable performer with a significant increase in sales activity in the June Quarter – the highest levels since late in 2021. There are no suburbs with negative trends in West Torrens, while rising markets are headed by Underdale, Torrensville, Plympton and Fulham.

The Port-Adelaide Enfield LGA has numerous suburbs with positive ratings, with sales activity overall much higher in the June Quarter compared to the March Quarter and the same time last year. Notable rising markets include Lightsview and Blair Athol.

The City of Marion has recorded its highest quarterly sales numbers since mid-2022 in a market dominated by suburbs with positive sales trends, including rising suburbs Warradale, Hallett Cove and Edwardstown. The median house price for Hallett Cove has risen from $470,000 to $800,000 in the past four years.

Some of Adelaide’s more upmarket precincts are also travelling well. Ten of the suburbs in the Charles Sturt LGA are ranked as rising markets, headed by Flinders Park, Findon and Bowden.

Sales activity has been rising steadily in the Holdfast Bay municipality in the past four quarters. A standout feature is that the unit markets in both Glenelg and Glenelg North are classified as rising markets in our latest analysis.

The upmarket City of Unley has a particularly strong June Quarter, with sales numbers up almost 50% on the March Quarter. Rising suburbs include Parkside (median house price $1.3 million), Clarence Park ($1.27 million) and Myrtle Bank ($1.6 million).

The overall conclusion is that the Adelaide market continues to pump strongly and is likely to be a national market leader on price growth for the foreseeable future.

One of the greatest misconceptions in the housing market is that property investors are the people who cause property prices to rise.

The evidence confirms that this is a major piece of misinformation but some sections of politics and news media love to perpetuate this fiction.

And, as an extension, use it as justification for advocating the end to negative gearing.

Some people appear to believe that eliminating negative gearing tax benefits will fix all the problems in the property market: rising prices, housing affordability generally, the shortage of new homes, the rental crisis, pretty much everything.

And, like so much of the debate about housing issues, it’s patently false and nothing more than an expression of the politics of envy.

So let’s look at the reality of who has influence in our housing markets and in particular in causing prices to rise over time.

My view over time, supported by the research evidence, is that the largest and most powerful cohort in the residential real estate industry comprises home buyers other than first-home buyers – i.e. owner-occupiers buying their next home, whether up-grading or downsizing.

They are the largest group of buyers numerically, they have the greatest market share and they have the greatest borrowing capacity and ability to pay higher prices than any other group in the market – they’re older, have higher incomes, have equity in their existing homes, they’re aspirational and they have borrowing capacity, far more so than first-home buyers or the average investor.

The latest edition of the NAB Residential Property Survey tends to confirm that view.

The report states that buying activity in the established property market is, and I quote, “dominated by owner-occupiers net of FHBs” – which means home buyers other than first-home buyers.

The NAB report says they comprise 44% of buyers in the Australian housing market and comments: “These buyers account for the lion’s share of established home sales in all states.”

The next biggest buyer cohort is first-home buyers, who comprise 34% of buyers in the market.

Australian investors are just 18% of buyers and foreign investors around 4%.

So the people constantly blamed for prices rising and causing poor housing affordability, Australian property investors, have a market share of just 18%.

More than three-quarters of buyers out there in the market are home-buyers – and they have massive advantages over investor buyers.

They have lower interest rates, they have lower levels of stamp duty, they have lower council rates and lower rates of insurance, and they don’t have to pay land tax or capital gains tax.

If they’re first-home buyers they also receive government grants and other assistance measures, including stamp duty concessions.

The only advantage that property investors can access is negative gearing, which around half of property investors can use to reduce their tax.

The research shows that the typical property investor is young, on an income below $100,000 and restricted on what they can pay by their borrowing capacity, which is less than a home buyer on the same income because the investor has to pay higher interest rates and stamp duty.

What many politicians and journalists want us to believe is that a cohort which is just 18% of the buyers in the market and restricted in their borrowing capacity by numerous factors somehow overpowers the 78% of buyers who are owner-occupiers - and therefore, apparently single-handedly cause house prices to rise.

It simply isn’t so.

The myth of the advantaged and privileged property investor is the greatest lie in real estate.

The trend we call the Exodus to Affordable Lifestyle is among the most powerful forces impacting real estate markets across Australia.

It’s a trend that been around for at least the past 10 years, with more and more residents of the biggest cities relocating to smaller cities or regional areas in search of a different and more affordable lifestyle, empowered by technology which allows many people to work remotely.

It was NOT created by the Covid lockdowns. It was under way long before Covid appeared in 2020 and it continues to have considerable momentum now that we are well beyond the pandemic restrictions.

But media continues to perpetuate the fiction that this was a Covid thing – and to express surprise that, now that we no longer have lockdowns and border restrictions, people are not all moving back to the big cities.

The latest quarterly edition of the Regional Movers Index confirms that this trend is as strong as ever – and it has generated more shock/horror/amazement from journalists who think it was all about the Covid lockdowns.

One article in major media expressed surprise that “Australia is not going back to the pre-pandemic way of life”.

And there’s a very good reason for that: this trend has very little to do with the pandemic.

The Regional Movers Index – which is a collaboration between the Regional Australia Institute (RAI) and the Commonwealth Bank - has once again reported that there are far more people relocating to regional areas than making a move in the opposite direction to major cities, with a 27 per cent difference in the June 2024 Quarter.

What the latest figures confirm, according to RAI chief executive Liz Ritchie, is that “the population movement we’re seeing is a sustained trend”.

Ritchie says: “Regional Australia has become the nation’s new frontier.”

The latest data highlighted a number of specific hotspots that are reaping the benefits of Australia’s romance with the regions.

Lake Macquarie, which sits beside Newcastle in NSW, has emerged as one of Australia’s most popular destinations for movers, securing an almost 5 per cent share of net internal migration over the past year.

Neighbouring local government areas on the NSW south coast such as the Bega Valley and Eurobodalla both experienced strong annual and quarterly surges in movement, according to the report.

Large centres within a few hours’ drive of capitals remain popular with many movers, however the regions that experienced the biggest population changes over the past 12 months were generally further afield, including Townsville (Qld), Mid-West Regional (NSW), Strathbogie (Vic), Murray Bridge (SA), Greater Geraldton (WA) and George Town (Tas).

Approximately three-quarters of the city dwellers who made the move to the regions in the past three months found new homes in either regional NSW or Victoria, confirming that Sydney continues to shed the highest number of residents, followed by Melbourne.

But that’s not to say that Queensland’s appeal has waned entirely, with regional Queensland’s share of net city outflows sitting at 19 per cent, even though it was as high as 41 per cent this time last year.

Indeed, the Sunshine Coast has retained its title as the nation’s most popular destination for relocators, accounting for a 14 per cent share of net internal migration. The Gold Coast has slipped down in the rankings, however, with the city experiencing a net outflow of people to other regional areas.

Western Australia also proved attractive for relocators, with Albany, Bunbury, Busselton, Capel and Northam all seeing an inflow of new residents.

The overall picture is that the trend of people moving from Sydney and Melbourne to regional areas continues strongly, with large numbers of big city dwellers still seeking a different and more affordable lifestyle.

Top economists are unanimous in believing Australia's housing market is in crisis, according to a new poll.

And I have to say, Wow, we had to go to a group of “top economists” to achieve that startling revelation.

It comes from a survey in which the Economic Society of Australia offered these top economists a choice of 14 measures identified by as likely to restrain prices for buyers and renters – in other prevent property prices and rents from continuing to rise.

Therein lies the first problem: they polled economists rather than real estate experts.

If there’s one thing we’ve learnt in the past four or five years of observing real estate analysis and commentary is that economists, generally and collectively, have a very poor understanding of real estate markets, which is why they are so incredibly bad at predicting outcomes.

But, ignoring that reality, the survey asked 49 people described as “leading economists” to respond to this question:

"Here is a list of measures governments could take to increase housing affordability (to reduce the cost of purchasing or renting relative to wages). Which would you most support? Pick up to three."

Among them, apparently, are former heads of government agencies, a former Reserve Bank board member, and former Treasury, International Monetary Fund and Organisation for Economic Co-operation and Development officials.

Sadly, but rather typically, the poll didn’t include any property experts. Just a group of individuals who have typically occupied ivory towers a long way from the coal face of property markets.

And here’s the next problem with this process:

the tick-box options presented to the leading economists did NOT include the only measure likely to ease the rental shortage and therefore restrain rental increases – providing incentives for people to become landlords.

You have to wonder why not.

So, whoever designed the poll – yes, a group of economists – failed to understand the problems they were exploring.

Of the options the panel of non-experts were given to choose from, two-thirds of them picked "ease planning restrictions" as most important fix. Almost as many picked "provide more public housing".

So, most believe that creating more dwellings will fix everything. Which, again, shows a fundamental lack of understanding of the problems, how they were created and where the solutions lie.

But it gets worse.

About one-third wanted to "tighten negative gearing and capital gains tax concessions".

You have to wonder about the thought process here. How does causing a major deterioration in the financial position of the people who provide the homes tenants occupy cause rents to fall?

And given that investors are less than 20% of the buyers competing in the market, how does this stop prices from rising.

Surely you would have to introduce measures to curtail home buyers, who comprise almost 80% of buyers competing in the market, if you wanted to stop prices from rising.

Back to the survey: about a third of the respondents wanted to "replace stamp duty with land tax applying to family homes".

Okay, so that’s a measure that might slow down home buyers a little.

Also popular were removing barriers to building prefabricated homes (31 per cent), fast-tracking the training of h ome builders (18 per cent) and fast-tracking the immigration of home builders (14 per cent).

Again, all are measures to increase housing supply and this appears to assume that building more dwellings will stop prices and rents from rising.

Ten per cent of those surveyed wanted to include the family home in the age pension assets test, 8 per cent wanted to remove first homeowner grants and concessions, and 6 per cent wanted to apply capital gains tax to family homes.

So, those measures at least at targeted on home buyers and appear to recognise their part in causing prices to rise, but these were the least popular of the tick-box choices.

The most popular were all measures which assume that building more homes and curtailing property investors will fix all problems.

But doesn’t explain how clamping down on the providers of rental homes will cause rents to fall – or stop prices from rising

A question I get asked more than any other is where I see the Australian property market heading in the next 12 months OR what I expect to happen with Australian property prices this year or next year.

And the answer I provide is usually delivered in multiple parts.

Firstly, there is NO Australian property market.

Although economists and journalists often refer to “the Australian property market” and predict what will happen with “Australian property prices”, the reality is that there is no such entity as the Australian property market.

Secondly, what I expect to happen with prices depends on where, because we have so many different markets across the nation.

Thirdly, real estate is local in nature and the market activity and the price movements depend on the local economy which underpins the location’s property market.

Take a look at the price growth results among the eight capital cities for the past year and you will note that some have had boom growth, some moderate growth, some have stagnated and a few have had falling prices.

All those different scenarios occurred within just the eight capital cities. There were similar variations occurring throughout all the regional markets.

All those places sat within the same national economy, all had the same situation with interest rates and all were operating under the one Federal Government.

Why, then, did we have all those different outcomes?

And the answer is: Because real estate markets are very LOCAL in nature. The greatest influence on them is the local economy.

So, if you want to understand a particular property market, first you need to understand everything that’s happening there in terms of the various local industry sectors, the infrastructure and other developments that are under way or in planning, and what’s happening with local jobs creation.

Once you can understand whether the location’s economy is weak or strong, growing or stagnant or contracting, then you can begin to determine what might happen with property prices.

For that reason, at Hotspotting we are always keenly interested in a quarterly report published by CommSec, called the State of the States report.

This report uses a series of different metrics to rank the eight state and territory economies.

And I have found, over many years, that there is a correlation between the strength of the state or territory economies and the performance of the capital city property markets.

The past three quarterly editions of the State of The States report have ranked South Australia as the No.1 ranked economy in the nation, a finding that would surprise many people.

But it doesn’t surprise the team at Hotspotting because we are very aware that the economy of Adelaide and South Australia is pumping strongly, helped by its status as the high tech innovation capital of the nation and the leading state for alternative energy developments. It also has a big education sector, a major military economy and a lot more.

Coinciding with the rise and rise of the South Australian economy has been the rise and rise of the Adelaide property market.

In 2023, Adelaide was the No.1 or the No.2 market in Australia for house price growth (depending on whose statistics you believe), in competition with Perth.

PropTrack’s data showing the leading suburbs and towns in Australia for price growth in the four years since Covid arrived, finds that the top 5 suburbs in the nation for price growth performance were ALL affordable suburbs in Adelaide.

In the latest edition of The State of the States, the No.2 ranked economy was (again) Western Australia - and again, there’s a clear correlation between that reality and the performance of Perth as one of the leading boom property markets in the nation.

Melbourne and Victoria now rank No.3 on economic performance and this is one of several reasons why we believe that this market is poised for price growth in the next 12 months and beyond, coupled also with very strong population data and a significant program of big infrastructure projects.

Consistently at the bottom of the CommSec report rankings is the Northern Territory – and it does not surprise us that Darwin has the weakest house price performance of all the capital cities in the past 12 months.

Other economies with lukewarm economic performance are Tasmania and the ACT – and this corresponds with the poor price performance of the Hobart and Canberra housing markets in the past year.

So this report, freely available to anyone who is interested, is one that’s worth following – because, read in conjunction with other data, it can provide clues about where prices are likely to rise in the near future.

Contemplate this scenario: you buy a capital city house for $380,000 and a year later it has a market value of $530,000. Up 40% in 12 months, providing a capital gain of $150,000.

Or this one: you paid just $240,000 for a house in a regional centre and a year later it’s worth $325,000 – up 35% in 12 months. And you’re getting a rental return above 7%.

A third example is paying $380,000 for a house in a capital city and watching it grow to $480,000 in 12 months. Meanwhile, rents have grown 25% in your suburb, underpinned by a vacancy rate of 0.4%, and your rental return has increased from around 6% initially to well above 7% a year later.

These are some of the scenarios to emerge from our analysis of the 50 locations in the special report, The Pulse, published quarterly by Hotspotting in conjunction with depreciation experts Washington Brown.

That 40% capital growth scenario has occurred in the Perth suburb of Hillman, which has benefited from the extraordinary price increases experienced in the Western Australian capital in the past 12 months.

The 35% leap in values happened in the little-known NSW regional town of Moree, where values have been boosted by construction of Australia’s biggest national infrastructure project, the $35 billion Inland Rail Link which spans the three major eastern states.

The third scenario relates to Elizabeth East in the northern suburbs of Adelaide, a precinct heavily targeted by first-home buyers and investors for its affordability, good amenities and proximity to major employment nodes.

These and other outcomes in locations featured in our report in the past year demonstrate one of the fundamental philosophies that underpins our recommendations to investors:

Contrary to a popular real estate theory, you don’t need to choose between capital growth and high rental yields. If you select your location well, you can benefit from both.

The 50 locations featured in The Pulse report are chosen because they offer above-average rental yields – but we also require our nominated locations to have the credentials for capital growth.

Of the 50 locations in the current edition of the report, 48 have recorded growth in their median prices in the past 12 months – including 30 with capital growth above 10%.

The top 10 have all had price rises well above 20% - in addition to providing superior rental yields.

But the truly outstanding markets are the ones with exceptional growth in both prices AND rents.

Consider these examples.

Firstly, Armadale in WA.

Before Perth’s boom convinced investors that any house in Perth was a good buy, few people wanted to buy in downmarket Armadale. Now it’s flavour of the year for those seeking a cheap house with high growth prospects. The data for the past year is extraordinary, with the median price up 35% and rents up 28%. The median is now $460,000 but you can still get 6% yields.

Then, there’s Carey Park, WA: This affordable suburb in the key regional city of Bunbury has become a sought-after location for investors seeking low entry prices and high rental yields. Those who followed our advice and bought there a year ago would be happy: the median house price has jumped 22% and rents are up 23%. The median price is still under $400,000 and rental yields remain around 7%.

What about Murray Bridge, SA: Regional South Australia seldom features in the national discussion about real estate growth but it has excelled in recent years, led by Murray Bridge, where both the median price and the median rent for houses have risen 20% in the past 12 months. Vacancies are ultra low at 0.4% and, despite the growth of the past few years, the median price remains within reach of most buyers at $430,000.

And then there’s Woodridge, QLD: This is another unfashionable option which has nevertheless out-performed. Typical units in this southern Brisbane suburb now cost above $300,000 following annual median price growth of 24% - and, with rents also rising 16%, investors can find yields between 6% and 7%, with the vacancy rate around 1%.

There are many other examples like these on our list of 50 key suburbs which we have listed for their superior rental yields AND potential for capital growth.

And they’re all affordable places that should fit within the budgets of most investors.

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Episode Overview:

In this insightful episode of the Hotspotting podcast, Tim Graham sits down with Ben Kingsley, the Chair of the Property Investors Council of Australia (PICA), to discuss the vital role that property investors play in shaping the future of Australia's real estate market. Ben provides an in-depth look at the importance of the PIPA Annual Investor Sentiment Survey and how it captures the pulse of the property investment community.

Key Discussion Points:

Importance of the PIPA Survey: Ben highlights why the PIPA Annual Investor Sentiment Survey is a critical tool for understanding the mood, confidence, and key trends in the Australian property market. He explains how the survey data influences media and policymakers and why it’s crucial for all property investors to participate.

Advocacy through PICA:

Tim and Ben delve into the advocacy work that PICA does on behalf of property investors. Ben shares how PICA ensures that investors' voices are heard in important policy discussions and how membership in PICA can help protect and advance investors' interests in the face of changing regulations.

Membership Benefits: Ben outlines the many benefits of joining PICA, from staying informed about the latest changes in property law to networking with other like-minded investors. He also discusses how PICA members can access exclusive resources and support to enhance their investment journey.

Current Market Challenges:

The conversation also touches on the current challenges facing property investors, including new rental regulations and tax laws. Ben offers practical advice on how PICA membership can help navigate these complexities and safeguard investments.

Why You Should Listen:

Whether you're a seasoned property investor or just starting out, this episode is packed with valuable insights that will help you better understand the landscape of property investment in Australia. Learn how your participation in the PIPA survey can make a difference, and discover how PICA can support your investment goals.

Don’t miss out on the opportunity to have your say in the PIPA Annual Investor Sentiment Survey and consider joining PICA to ensure your voice is heard in the property investment community.

Visit Hotspotting.com.au for more resources and insights.

Complete the survey here: https://www.surveymonkey.com/survey-taken?sm=PXT61WAC1xL5N1S9IJePE1hAn4c6_2BrMhKsShimHkkmEzip1e9oEIwz8mVtE4BUS48EmEeTvIueOcJ2V9C91IGMteQ6VUOkZjAoyRp6M3rtZL2jIJEdiWCxXHtoDzsPg3MiLuyrYFEEQtWCQHMn_2F1xw_3D_3D

Join Pica here: https://pica.asn.au/membership/why-join/

There are two opposing story lines circulating in news media about Australian real estate ownership.

One story line, repeated regularly by media, is that the Great Australian Dream is dead and that young Australian adults can no longer afford to buy homes.

The other one, revealed whenever the Australian Bureau of Statistics releases official data on real estate finance, tends to suggest that the dream is very much alive – and indeed thriving.

In fact, the latest lending figures show major increases in buying activity by all types of real estate consumers, including first-home buyers.

Media loves negative sensation about housing affordability and very often the truth is optional.

Some organisations who crave publicity to lift the profile of their businesses regularly feed this weakness in news media by creating bogus reports about Australian housing affordability.

They do this, usually, by applying a set of parameters that are irrelevant and unrealistic.

Here’s a typical example: a so-called research organisation will create a report which examines how long it takes a young couple to save a 20% deposit to buy a house at the median price in Sydney or Melbourne.

Or how much a person needs to earn to achieve a loan for this.

Now, there are multiple reasons why this is a nonsense designed to create a headline rather than inform the public. These reports are full of furphies.

Furphy No.1 – you don’t need a 20% deposit. You can get into real estate ownership with a 10% deposit or even a 5% deposit.

Furphy No.2 – first-home buyers don’t buy at the median price in Sydney or Melbourne or anywhere else. They buy in the lower price ranges. The city median is irrelevant to the circumstances of young buyers and the issue of affordability.

Furphy No.3 – these reports always overlook attached dwellings as an option for buyers seeking affordability. In many capital city suburbs, the median price for units is half the median price for houses. But these bogus reports never speak about this viable, popular and more affordable option.

Why are these so-called research reports full of irrelevant and misleading information? Because the goal is NOT to inform people, or help people, or improve the situation for the community. The goal is always self-serving and dishonest – to create free publicity by generating alarm in the community.

And journalists are happy to recycle this nonsense as factual news.

In Sydney, the median house price is close to $1.5 million (according to CoreLogic) but that is irrelevant to people seeking affordability in our most expensive capital city.

What is considerably MORE relevant is how much it costs to buy a unit in the Canterbury-Bankstown area of Sydney, where there are plenty of viable options in multiple suburbs in the price range from $400,000 to $600,000.

Or what it costs to buy a house in more affordable parts of Greater Sydney, like the local government areas of Liverpool, Parramatta and Blacktown.

And of course there is the reality that over 20 million Australians live in places other than Sydney and the median house price in our most expensive city is utterly irrelevant to them.

How about some focus on what it costs to buy a house in the affordable northern suburbs of Adelaide, or an apartment in the inner-city Brisbane suburb of Bowen Hills, or in the inner-city Perth suburb of Belmont or a house in outer-ring areas of Greater Melbourne.

And what about regional Australia, which is attracting growing numbers of new residents relocating from the biggest cities in search of a different lifestyle, empowered by technology that allows more and more people to work remotely.

So, let me tell you, the home ownership dream is very much alive right across Australia.

How can I be so sure? Because the official lending data confirms it.

The latest stats from the ABS – which is for the month of June - shows we are currently seeing growing numbers of people buying homes as first-home buyers, other types of owner-occupier buyers and investors.

Lending for the purchase of homes rose 19% in June, compared to a year earlier.

In June lending to owner-occupier buyers was up 13% compared to a year earlier, with an even larger increase in loans to investors. There was also a rise in lending to first-home buyers, though not as large an increase.

It should be fairly self-evident that lending levels would not be rising, including for first-home buyers, if it was true that no one can afford to buy any more.

We have highly active property markets in most parts of Australia and buyers of all kinds are active.

So, next time you see one of those shallow media headlines declaring that the dream is dead and that young Australians are priced out of the market, don’t believe it.

The markets currently attracting our focus at Hotspotting are the ones we call “the second wind markets”.

These are locations which experienced strong capital from 2020 to 2022, have been in the post-boom pause/correction phase for the past 18 months or so, and are now poised for another period of price growth.

There are few better places to find second-wind markets than Regional Victoria, as many of the key centres have exhibited that pattern over the past 3-4 years and are now showing the early signs of revival.

Many of the suburbs of Ballarat are classic examples. The median house price for Sebastopol rose from $330,000 in 2020 to $475,000 by the end of 2022. There has been a price correction in the past 18 months but market activity is rising again and another period of price growth is expected.

Eaglehawk in Ballarat rose from $325,000 in mid-2020 to $520,000 in early 2023, before the price graph evened out over the following 12-18 months.

Bendigo displays similar patterns. The suburb of California Gully had a median house price of $300,000 in 2020, rising to $465,000 late in 2022. The price graph has flatlined since then, before showing the first signs of new growth in mid-2024.

Similarly, Flora Hill lifted its median house price from $255,000 in 2020 to $450,000 in early 2023 – but the price graph has been flat over the past 12 months. Now sales activity is rising again, which is a forward indicator of impending price growth.

Other markets in Regional Victoria have this pattern, which is a common one in real estate cycles with a period of strong growth followed by a period of correction or no growth, before the market embarks on the next growth cycle.

Shepparton, Traralgon, Mildura, Wodonga, Warrnambool and many other Victoria regional centres have this pattern.

They’re all places with solid local economies and credentials for future growth.

Most of them commonly have houses in the $400,000s and $500,000s, with low vacancy rates, so they present attractive features for property investors.

You can be forgiven for being confused about the Melbourne market.

On the one hand, news media is full of stories about investors shunning Australia’s largest city because of draconian taxes and policies by the nation’s worst state government.

There are also frequent articles about the lack of price escalation in Melbourne markets, at a time when many other capital cities are delivering stellar capital growth.

But this is balanced by the analysis from those who believe Melbourne to be a prime opportunity for buyers to get in early in a growth cycle, with the city’s markets poised for revival.

A strong state economy, a big infrastructure program and some compelling population data support the view that Melbourne is overdue for a growth spurt.

The first thing to understand is why Melbourne has underachieved in the past couple of years while others have excelled.

The lingering impacts of the Covid period are considered at least partly responsible. Melbourne was locked down for longer than other Australian cities and was indeed dubbed by media as “the world’s most locked-down city”.

There’s no doubt the attitudes and policies of Dictator Dan (Andrews) deterred many. And subsequent state policies unfriendly to investors – including the reality that Victoria has the highest stamp duty and the highest land tax in the nation – have deterred buyers from investing in Victoria.

On the positive side, Melbourne is the nation’s biggest beneficiary of overseas migration, which made it a national leader on population growth last year. Australia experienced a record number of new additions to the national population in 2023, with 84% of it attributed to overseas migrants.

So Melbourne, despite losing residents to internal migration (people moving to other parts of the nation), grew its population by almost 3% last year. Only Western Australia had higher growth.

Victoria consistently ranks among the nation’s leading economies and ranked third in the July 2024 edition of the State of the States report by CommSec. The July report comments that Melbourne is consistently strong across all the metrics used to rank the states and territories, which include population growth, construction work, housing finance, retail spending and employment performance.

A strong economy underpins the residential real estate market, because it means there is busy economic activity creating jobs, and from that springs demand for homes.

A key factor keeping the Victorian economy vibrant is the big program of infrastructure development across Greater Melbourne. They include multi-billion-dollar developments now under construction like the Suburban Rail Loop, North East Link, Metro Tunnel and West Gate Tunnel – which combined are estimated to cost over $70 billion.

Those projects alone – and there many others impacting the city – are likely to energise the local economy in ways likely to lead to growth in demand for homes.

So there’s a plausible argument that now is an opportune time to be considering investment in Melbourne, rather than doing what many investors do, which is dive into markets when they read there’s a boom on.

Far smarter to buy before the boom starts.

The trend we have termed “The Rise and Rise of Apartments” continues to pick up pace. Across Australia, more and more buyers are opting for attached dwellings for lifestyle, for affordability, for convenience and for safety.

One of the features that draws growing numbers of buyers (and tenants) to apartments is location appeal. Not only do attached dwellings allow people to access property in good locations at cheaper prices than houses, but the average unit is better located than the average house.

A report titled “Measuring Home Price Differences” by Infrastructure Victoria has found that units consistently trump houses on proximity to desirable features.

“Units are located closer to selected infrastructure types, on average, than houses and townhouses,” the report says.

The report found that units were far more likely to be located close to train stations, tram stops, major activity centres and arterial roads than houses. “About 60% of units are within 1.6km of a tram stop, while this distance only includes about 20% of houses,” the report says.

This is one of multiple factors driving higher demand for units – challenging the dominant paradigm of real estate. That paradigm, still widely accepted in the real estate industry, states that houses always outperform units and townhouses on capital growth.

But that is undoubtedly changing.

We are seeing growing evidence that more and more buyers of various sorts are opting for attached dwellings. Buyer demand in locations where units dominate the dwelling mix - or are a significant part of the dwelling mix - has been rising notably for the past 12-18 months.

Suburbs where units prominent are now among the most powerful markets in Australia – which makes our Top 10 Apartment Hotspots report essential reading for investors seeking opportunities in 2024 and beyond.

Those seeking out well-located and affordable apartments include older people downsizing from a large family home.

They also include …

young people seeking an affordable first step on the property ladder;
lifestyle buyers seeking low-maintenance, lock-up-and-leave options in good locations;
overseas migrants from countries where unit-style living is the norm;
investors seeking affordability and higher rental yields in good locations; and
buyers who seek the security and safety of an apartment above ground level.

In inner-city precincts in our biggest cities, houses can typically cost over $2 million, but apartments can be bought in the $600,000s and $700,000s in the same suburbs in many cases.

The rental yields are also significantly higher, a key consideration in times of higher interest rates – although it needs to be remembered that apartments do entail additional costs like body corporate fees.

But the most noteworthy data relates to capital growth. In a growing number of locations throughout Australia, apartments have recorded larger increases in median prices than houses, both in the past year and over the longer term.

At Surfers Paradise on the Gold Coast, apartments are considerably cheaper than houses, sell faster, have higher rental yields, have recorded bigger price growth in the past year – and the long-term capital growth rate also is superior.

There are many, many more examples like this across Australia.

New data from CoreLogic shows that apartment values are rising faster than those of houses in about six out of 10 suburbs.

This is also reflected in the general results for many of our major cities.

In the past three months, the median price for units in Brisbane rose 5.8 per cent, while houses increased 3.4 per cent.

Adelaide units outperformed houses by the same margin after increasing by 7.1 per cent during the same period.

Unit prices are also rising at a faster rate than houses across Sydney, Melbourne, Perth and Hobart, although they have fallen behind in Darwin and Canberra.

Across the combined capital cities, unit values rose faster than house values in 506 suburbs out of a total of 855 suburbs, with some unit markets gaining more than seven times more than houses.

The official data shows that the cornerstone of the financial wellbeing of most Australian households is the family home.

Over two-thirds of the household wealth in this country is residential property and, for most of them, this means their home - as most people don’t own investment properties.

The family home is the foundation of the financial security of most people and its value underpins people’s lives and their sense of security - and, in particular, their retirement.

The good news is that household wealth nationally grew 10% in the past year and 68% of that wealth resides in the residence.

The bad news is that if the Greens have their way, all of that will be decimated.

Their policy for real estate is to force the value of your home to fall - a lot.

And if you’re performing one of society’s most important functions, providing a home for others to live in as tenants, the Greens want you to be rubbed out. Not just curtailed, but eliminated.

Now, we’ve known for some time that the Greens are anti real estate and, in particular, hostile towards anyone who owns an investment property, even though these are the people who provide 91% of the homes that tenants occupy in Australia - and they’re in extreme short supply.

If the Greens have their way, ownership of investment properties will cease to exist in Australia - although, at the same time, they have no policy about who will provide the 3.2 million rental homes that investors currently provide.

But it gets worse, because the Greens plan is to force down the value of everyone’s home.

They apparently believe that this is how you deal with the issue of housing affordability.

One thing that is abundantly clear is, rather tragically, that no one in the Greens has any understanding of Australian property markets. They have no comprehension of how the cost of housing became so high, no clue as to how rental properties became so scarce, no understanding of why prices rise and no sensitivity to how important the value of the family home is in the life of the nation.

Because everything they propose to do, if they ever gained power, would make all of these issues infinitely worse and would decimate the structure of one of society’s most fundamental needs, shelter.

Observing the Greens espouse economic and real estate policy is like watching primary school kids talk about stuff they think is cool. Imagine if you could have anything you wanted and it doesn’t matter how much it costs and whether it’s really possible or not.

The Greens apparently don’t consider it necessary to cost their policies or to consider the consequences of their pixie-eyed plans.

Just one example: in the election campaign of local government in Queensland earlier this year, a key policy plank was fast rail connecting Brisbane, the Gold Coast, Toowoomba and the Sunshine Coast. There were no costings and no funding proposals for a plan, if you can call it that, which would cost many tens of billions of dollars.

They also said they would build hundreds of affordable homes on the site for the Eagle Farm race course In Brisbane and it would all cost no more than $40 million, glossing nonchalantly over the fact that the race course land has an owner not keen to cease operations, and that land alone is worth hundreds of millions of dollars, never mind the cost of construction of hundreds of homes.

But returning to their policy of smashing the value of family homes.

Imagine if you’re a young couple who saved a 10% deposit and bought a first home for $600,000 and you have a mortgage of around $550,000. If the Greens had their way, your new home would be worth less than the size of your mortgage. You would be in a position of negative equity and you would be in an extremely vulnerable position. Your bank would be highly concerned and everything you have worked, saved and sacrificed for would be at risk.

Now multiply that by millions of other households and you have a financial, economic and personal disaster of galactic proportions.

And that’s apparently what the Greens want for Australia.

Two-thirds of Australian families own their homes and most would be alarmed at the scenario that the Greens think is fair, reasonable and desirable.

But even more fanciful than the Greens’ objective of destroying the value of our homes is the means by which they say they’ll achieve it.

Their stated plan is to scrap negative gearing and increase capital gains tax.

This apparently, miraculously, will cause the collapse of property values in Australia.

The Greens believe that the owners of investment properties in Australia are a criminal class and the source of all evil in the housing market.

Smashing investors will fix everything, apparently, including housing affordability, the rental shortage and the ongoing increase in rents.

No one cares what happens to investors, in the Greens’ mindset, because they’re all rich bastards who own 15 or 20 properties and earn millions of dollars a year - right?

Well, no. Here’s the reality. The typical investor is a young Australian who earns less than $100,000 a year and owns just one property or is buying their first.

They’re not wealthy, they’re not inherently evil and because they cannot afford to spend big, they’re buying at the lower end of the market and are limited in how much they can spend on a property.

They comprise perhaps 30% of buyers in the market. The other 70% are home buyers and the largest and wealthiest cohort in the market are home buyers other than first-home buyers.

They own their existing home, they have equity, they’re older with higher incomes, they can borrow more than first-home buyers and typical investors, and they’re aspirational. They’re the ones most likely to be pushing up dwelling values.

Investors are limited in their borrowing capacity and seriously disadvantaged in the market, because they have to pay higher interest rates, higher stamp duty, higher insurance, higher council rates - plus they have to pay taxes that home buyers don’t have to pay, like land tax and capital gains tax.

The Greens say they are privileged and advantaged – but clearly the opposite is true.

Australia scrapped negative gearing in the 1980s and it didn’t stop prices from rising. But it did create a rental shortage, so a couple of years later the then Labor Government reinstated negative gearing.

New Zealand scrapped negative gearing in 2021 and dwelling prices kept rising. It was only later, when interest rates went extremely high, much higher than Australia, that NZ prices stopped rising.

But it did make rental properties scarce so New Zealand is now in the process of bringing back negative gearing.

But do the Greens care about any of that? The answer is that the Greens don’t know any of that because they don’t bother themselves with annoying things like knowledge or research.

They’re the spoiled brats of Australian politics and, if they have their way, you’re going to lose a big chunk of your wealth.

Be afraid, be very afraid.

There are many unhappy aspects of the rental shortage crisis that has afflicted Australia for several years and is likely to continue for many years into the future.

But the saddest thing of all about this unprecedented calamity is that Australia deserves the pain it’s experiencing on this issue.

Firstly, there’s the old adage that we get the politicians we deserve.

And the politicians we’ve elected – at both state and federal levels - have created the rental shortage through a series of bad policies.

They keep making it worse with further unhelpful decisions.

The problem has been exacerbated by news media and by the attitudes of many citizens.

It’s a sad truth in Australia that when a serious problem arises, it’s very rare that we find and implement solutions.

What we do, instead, to identify scapegoats - usually unfairly and inaccurately.

Then we demonize the people we have decided to blame for the problem.

But we don’t fix the problem. The demonizing of the wrong people usually makes it worse.

So it is with the rental shortage crisis.

The extreme under-supply has been created because fewer and fewer people want to be landlords.

And why would you?

You have to pay taxes no one else pays, like land tax and capital gains tax, you have to pay higher council rates, higher stamp duty, higher interest rates and higher insurance premiums.

Every time a state government changes the rental laws, they are grossly biased towards tenants and often completely disregard the rights and needs of the people who own the properties that people rent.

Meanwhile, investor owners are vilified and demonized by dishonest politicians and journalists for whom the truth is optional while they’re espousing their personal viewpoints dressed up as news.

And, on the sidelines, large sections of the media and small-minded citizens cheer enthusiastically, while complaining about the rental shortage.

One journalist who got it right recently was the personal finance writer for The Australian, Anthony Keane, who commented that owning an investment property in this country has now become a source of stigma and shame.

He wrote: “Buying an investment property used to make me feel proud, but now it borders on shame. Surely, that’s not how we want Australians to feel for trying to build financial security and reduce their reliance on welfare later in life.”

He also commented: “Chopping down tall poppies can be a national pastime, but ATO figures show that most of Australia’s rental property owners have just one property. Many are teachers, nurses, police officers and emergency service workers. Since when did they become tall poppies?” he said.

Some people try to be tall by cutting off the heads of others. In other words, as Anthony Keane pointed out, we’re talking about the tall poppy syndrome and the politics of envy.

For many Australians, if they observe others apparently doing better than they are, they will support policies to squash those people.

Apparently, they are unaware that this is what has created the rental shortage and the rising rents that everyone is complaining about.

Which I why I say that, sadly, Australia has got the housing crisis it deserves.

Until the nation changes its attitudes, this problem will not only continue, but get worse.

Sooner or later, Australia will have to acknowledge that investors are not the problem, they are the solution.

The reality of the nation’s serious under-supply of homes is made starkly obvious by the emergence of shortages in the location best known for bouts of major over-supply.

The Gold Coast, which traditionally has delivered weak capital growth because of regular periods of over-supply of high-rise apartments, these days has the opposite problem.

The Gold Coast has been trending towards under-supply for the past 2-3 years and it’s getting worse - and will continue to do so for the foreseeable future.

The Gold Coast has long been one of the nation’s most spectacular population growth venues and currently has a population of about 700,000 - making it the largest regional city in Australia.

It’s projected to reach a million residents within the next 20 years.

This notable history of population growth and the allowance of mega high-rise buildings has made the Gold Coast a prime target for big developers - and there have been many periods of massive construction of mega towers.

Often this has resulted in over-supply, which has taken the market years to absorb. Up until about three years ago, the median apartment price for Surfers Paradise was at the same level as a decade earlier - in other words, no capital growth for 10 years.

But that has all changed. The population growth has continued and in recent years demand has risen. The trend we call the Exodus to Affordable Lifestyle has increased demand for appealing coastal cities and the Covid lockdown period increased buyer demand for the Gold Coast.

In the meantime, the level of major new construction has declined dramatically.

Quite simply, many developers have done their sums and concluded that 40 and 50 storey apartment towers don’t stack up financially. The costs of building these structures have escalated to the point where the end price developers would have to charge to be profitable would be beyond the market’s capacity or willingness to pay.

One of Queensland’s biggest and most experienced developers told me recently they could not commit to a high-rise building unless they believed they could sell the apartments for a minimum of $1 million each.

Many big developers have decided that, with costs growing so fast, it’s difficult to budget for the cost of the development that takes years to plan and construct.

So big developers have cancelled or deferred projects.

According to a recent report by experienced Queensland property analyst Michael Matusik, for a number of years before 2021 the Gold Coast market was producing enough new dwellings to meet the demand from its rising population - indeed, a little above the required levels in some years.

But since 2021 that has changed dramatically. The line on the graph depicting supply has fallen more and more below the line representing underlying demand.

The Gold Coast market is now in severe under-supply and likely to get worse.

It’s a national problem with the Gold Coast providing a snapshot of a broader Australia-wide issue for which our elected representatives appear to have no solutions.

Great property investments can be defined in different ways.

Here’s a definition that will resonate with many investors:-

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It’s credentials like those that make service station properties so highly sought by investors who understand the fundamental benefits of commercial property.

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Long leases to international brands (including Caltex, BP and Coles Express).

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Steve Palise, a member of Hotspotting’s Panel of Partners, says notwithstanding the gradual rise of electric cars, petrol stations will still be in huge demand until 2040-2050 especially highway sites and in country areas.

“Trucking and logistics technology is not there yet so major arterial roads will still require petrol stations even longer than this,” he says.

“Over time there will be a phase of converting petrol stations to a blend of food, entertainment, customer experience, co-working, and fitness.”

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To connect with Steve, please visit https://www.paliseproperty.com/

There really is no realistic prospect of rental vacancies rising significantly any time soon, which is grim news for tenants in most parts of Australia.

Vacancy rates continue to be close to those historic lows that have become the norm in the past couple of years and I can’t see any way they will improve in the foreseeable future.

The politicians who have created this unprecedented shortage of rental properties are clueless about how to fix their mess – and most of their actions which impact on the situation make it worse, not better.

The latest data on vacancies nationwide – from one of the key sources, SQM Research - has the national vacancy rate at 1.3% in June, the same as it was a year ago. We still have capital cities with vacancy rates well below 1%, including Adelaide, Perth and Darwin.

That June vacancy rate was slightly up on the rate for May, but that’s attributed to seasonal factors.

Here’s what Louis Christopher, managing director of SQM Research and one of Australia’s most experienced and respected research analysts, says about the current situation and about the future of vacancy rates:

“Based on history, we have now reached the peak in rental vacancy rates for Winter. It is likely that, vacancy rates will now begin to tighten again and keep tightening until November.

“So far this year, we have recorded very similar vacancy rates compared to the same period in 2023.

“Overall, the national rental market remains in severe shortage and barring some exceptions, is not expected to materially soften out of the rental crisis for some years.”

So what does this mean for residential rents?

Well, it doesn’t necessarily mean they are going to continue rising at 10% or more per year.

While vacancies are set to remain dangerously low for some time, there is a ceiling beyond which rents can’t rise because to the capacity of tenants to pay.

Louis Christopher says: “Much of the structural rental shortage has now been priced into the rental market and so I do believe the days of 10-20% plus annual rental increases have come to an end.”

I agree. Tenants, who tend to have lower incomes, have had years of rising rents and they can’t keep paying more and more in rent, in times when they’re also paying more for food, electricity, petrol and other essentials.

But the situation of ongoing ultra-low vacancies does mean that rents won’t fall. They will remain at the current high levels for the foreseeable future.

There will continue to be upward pressure on prices and rents for the foreseeable future, with no end in sight for the imbalance between supply and demand in residential property markets across Australia.

National valuation firm Herron Todd White reports that, nationally, home prices have increased for 17 consecutive months and the median home price is now $784,000.

According to Oxford Economics, the nation’s housing supply and affordability crisis is likely to deepen and will remain a “chronic” issue for years to come.

Oxford Economics is predicting we will fall well short of the Federal Government’s ambitious plan to build 1.2 million new homes over the next five years.

A new report from the firm, Building in Australia, forecasts just 960,000 new homes will be built between now and 2029, well short of the 1.2 million target in the government’s National Housing Accord.

The figures underline industry fears that it will struggle to keep up with an ongoing population rise fuelled by a wave of new migrants – and also not helped by labour shortages, dysfunctional planning systems and high construction costs.

The report author Timothy Herbert, Oxford Economics head of property and building, says while new housing construction could well reach record levels by the end of the decade, it wouldn’t be enough to keep up with demand.

Herbert says: “While industry capacity is showing signs of improvement in some areas, labour shortages remain that will place a speed limit on the early to mid stages of the recovery.”

But he also says: “We will continue to experience a dwelling stock deficiency, but activity will inevitably recover in the residential sector. All build forms will contribute, driving total dwelling commencements to a new record level by the end of the decade.

“Attached dwellings are forecast to join the upswing from FY2026 with support from falling interest rates, the upward rebasing of rents, co-ordinated social housing investment, and planning tweaks in key markets. Build-to-rent development has risen to around one-fifth of apartment starts and is expected to grow this share a little further through the late decade.”

This report adds to the views of many others that the Federal Government’s stated goals for housing construction were never realistic and had no chance of being achieved – and therefore the shortage would not be adequately addressed, keeping pressure on prices and rents.

The Housing Industry Association earlier this month warned the government would fall short of its housing targets by 64,000 properties in the first year alone.

To reach the 1.2 million target by the end of June 2029, an average of 240,000 homes need to be built each year, a level that has never been achieved in the nation’s history.

Only 963,000 new homes were completed over the past five years despite the pandemic HomeBuilder stimulus, which sent building levels to record highs.

The HIA is calling for tax relief, planning reforms and incentives to attract more workers to the industry in order to avoid what it predicts will be a 180,000-home shortfall over the next five years.

And the Government-appointed independent advisory body - the National Housing Supply and Affordability Council - has also shot down the government’s targets, estimating a homes shortfall of almost 300,000.

It suggests the private market will only be able to supply 903,000 new homes to 2029.

Real estate consumers tend to place their attention on the markets receiving the most media headlines, which primarily are the ones that have shown the biggest growth in the past month or the latest quarter or year.

But that is not the best measure of which locations have been showing the best growth.

To get a better picture of locations that out-perform, you need to look at longer time frames, such as the past THREE years, not the past week or the past month as media tends to do.

News media continues to obsess over the Perth market where prices currently are rising the fastest and they tend to imply that this boom will keep on rolling for years to come.

It won’t. Perth has already had a couple of years of major price growth and there are already signs that the market has peaked.

One of the things that would be more useful is for the media to take a broader focus of price performance, to give consumers a more enlightened picture of where the best growth has been.

For example, where in Australia have we seen the biggest growth over the past three years?

It would no doubt surprise many to learn that there are a dozen regional centres across Australia which have had considerably higher growth since 2021 than Perth – and most of the other capital cities as well.

Research published by one of Australia’s best real estate analysts, Simon Pressley of Propertyology, shows that the best performers on capital growth over the past three years have been regional cities - and that the best of the capital cities has not been Perth, but Adelaide.

So which location has recorded the highest growth in median house prices in the past three years?

According to Propertyology, the answer is Bundaberg in Regional Queensland, where the median price has risen 63% in three years.

Close behind comes Wagga Wagga in NSW, which has grown 56%.

Then we have little-known Gympie near the Sunshine Coast, up 51%, alongside Hervey Bay a little further north in Queensland, which also increased 51%.

In fifth place we have the first of the capital cities, Adelaide, which is up 50% on the pricing levels of 2021.

Next, in order, we have the Sunshine Coast in Queensland, Mandurah in WA, Rockhampton in Queensland, Tamworth in NSW, the Gold Coast in Queensland and Albury-Wodonga at the NSW-Victoria border.

In 12th place, up 40% over three years, is Perth.

Now, I’m happy to report that every one of those out-performing locations across the nation have featured strongly in our hotspots reports over the past 3-4 years.

And we featured them BEFORE that big period of three-year growth started.

In the 2020 editions of our National Top 10 Best Buys report, the Sunshine Coast was our top pick – and went on to be a national leader on price growth over three years.

In the 2021 editions of Best Buys, Bundaberg, Tamworth, Albury-Wodonga, Wagga Wagga and the Gold Coast, as well as key locations in Adelaide and Perth, all featured in our national top 10 lists – BEFORE the three years of growth happened.

And remember that, back in 2020 and early 2021, economists and the media generally were telling us that prices were going to crash everywhere. We simply did NOT agree – and we got it right.

This speaks to the essence of intelligent investing – accessing good research reports that tell you where the highest growth will happen BEFORE it happens.

NOT diving into markets where the media says prices have grown the most in the past year. That is the essence of BAD investing.

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For a long time I have argued that housing is expensive in Australia because politicians have made it so – AND keep making decisions that add to the cost.

The value of all residential real estate in this country is under-pinned by the cost of creating new dwellings – and those costs keep rising, way beyond the rate of inflation.

One of the biggest elements in the cost of new homes is the taxation component.

The research shows that a massive share of the cost of creating a new dwelling in Australia is taxes, fees and charges at all three levels of government.

The Federal Government, the various state governments and local government authorities all use residential real estate as a cash cow – in other words, they milk it for revenue.

Over the past 5-10 years, there have been a number of research reports which quantified how much of the cost of new dwellings comprises government imposts.

Some of that research has come from the building industry and some have been independent research reports by credible organisations.

And they have all arrived at similar conclusions: that somewhere between 30% and 50% of the cost of a new home in Australia is taxes, fees and charges at the three levels of government.

Why is it 30% to 50%? Because the percentage differs depending on location.

And now that reality has been confirmed by a new research report by the Property Council of Australia in Queensland – which has found that one third of the cost of new homes and apartments in that state is made up of government charges.

The report says: “The Queensland Government’s promise of delivering ‘a home for every Queenslander’ cannot be fulfilled under the current tax model.”

The ‘Stacked Against Us’ research report shows that government taxes, fees and charges make up 32 per cent of the total cost of a new house and land package in Queensland and 33.3 per cent of a new apartment.

For a $730,000 mortgage, that equates to $233,440 in taxes, fees and charges.

The report says: “The impact of these tax settings is seeing Queenslanders spend the first nine years of a 30-year mortgage package paying off prohibitive taxes, fees and charges – plus interest.”

And the report also says: “Queensland is in the grips of a housing affordability crisis. A key reason why houses aren’t affordable is the increasing burden of taxes and regulatory costs in the development of new houses and apartments.

“Taxes on new homes are a double whammy – they increase costs (and therefore sale price) of new builds, in turn increasing the costs of buying or renting established homes.”

The report points out that, over the past three years, the Queensland Government has experienced a $3.5 billion in windfall transfer duty receipts alone - representing a 29 per cent increase in receipts above the forecast level.

The situation in Queensland is being replicated across Australia.

It’s worse in New South Wales. In Sydney, the taxation component of a new dwelling on a block of land can be as high as 50%.

It’s becoming diabolically bad in Victoria, which has by far the highest taxes on residential real estate of anywhere in the nation.

The message to politicians is clear: if you really want to create affordable housing, as you say you do, stop treating the process of creating new homes for Australian families as a cash cow.

Economists don’t understand residential real estate very well and they’re scratching their collective heads over why prices keep rising when interest rates are high.

Here’s a couple of simple things to help them out: one is that, historically, there’s no evidence that rising interest rates lead to falling property prices. There’s nothing unusual about what’s currently happening in Australian property markets.

But the key factor is that we have very high demand for real estate, fuelled by record population growth, at a time of incredibly low supply.

The rental shortage is well documented.

But another statistic that depicts under-supply is the incredibly low level of listings in many parts of the nation.

The number of homes for sale is at dramatically low levels.

In June, the number of national residential property listings decreased by 8.3% compared to May.

Part of that was a 13% decline in the number of new listings of homes for sale, according to SQM Research.

Notably, all major cities experienced a decrease in their listings in June.

Adelaide recorded the largest monthly decrease in total listings, falling by over 15%. Melbourne and Perth followed, both recording decreases of 12%.

Perth recorded the largest annual decrease of 32%, while Adelaide, Brisbane and Darwin also had big falls in the number of homes for sale.

The data on listings correlates generally with the results we are seeing with prices.

The cities with the biggest declines in the number of properties for sale – Perth, Adelaide and Brisbane – are the ones with the major escalation in prices.

Cities where listings remain higher than a year ago – like Melbourne, Canberra and Hobart – are the weakest performers on price growth recently.

In Melbourne, for example, listings are 12% higher than a year ago.

It illustrates, yet again, that we don’t have a single property market in Australia, but lots of local markets doing different things.

And it also shows that supply and demand factors will override other issues, such as high interest rates.

A new factor now coming into the equation is the Federal Government’s tax cuts, which are likely to add to demand and put further upward pressure on prices by increasing borrowing capacity.

According to an analysis done by Shore Financial, borrowing capacity would increase by 4% for those with an income of $90,000 and 5% or more for those with an income of $100,000 or more. According to Mortgage Choice, the borrowing capacity of a buyer with a $100,000 income could increase by about $25,000 while someone earning $150,000 could borrow about $37,000 more.

In the meantime, the capacity of Australians to cut through all the barriers and buy real estate is shown in the lending figures – including the rise in the size of the average loan, which now sits at $625,000.

Sally Tindall, research director at comparison website, RateCity.com.au., says this:

“Over the last two years, buyers have seen their maximum borrowing capacity plummet, in some cases by hundreds of thousands of dollars, as a result of the RBA hikes, and yet the average new loan size has hit a new record high.

Tindall says: “It’s astounding to think owner-occupiers are, on average, taking out larger loans than ever before, despite the fact the cash rate is sitting at a 12-year-high.”

Maybe it’s not so astounding, given that demand from owner-occupiers and from investors remains high and supply continues to be low, putting further upward pressure on prices.

Brisbane and Queensland increasingly are emerging as the property market destination with leading metrics pointing to out-performance in real estate.

A couple of months ago Hotspotting published its annual report with Australia’s largest comparison website Canstar - the one we call Rising Stars – which analyses the capital city and state regional markets across Australia and ranks them for future growth prospects based on five key metrics.

And the leading market jurisdiction to emerge from that process was Queensland, including both Brisbane and Regional Queensland.

The Sunshine State has also, more recently, achieved nation-leading status in the latest population data published by the ABS.

Finance data also confirms an increase in loans to both owner-occupiers and investors, with the average loan size in Queensland at an all-time high.

In the Rising Stars report each year, we use five key metrics to rank the 14 major market jurisdictions in the nation - the eight capital cities and six state regional markets.

The report with Canstar ranks the 14 market jurisdictions from 1 to 14 on their prospects for growth in the coming year.

The 2024 edition of Rising Stars ranked Brisbane No.1 - the market with the best prospects to provide growth in the next year or so.

And the No.1 regional market in the nation, using this methodology, was Queensland.

Brisbane was a standout on all the five metrics we used to arrive at our ratings - sales activity trends, recent price movements, vacancy rates, rental growth trends and infrastructure spending.

Regional Queensland ranked in the top 4 nationally on three of the five metrics and it also produced solid ratings on the others.

The trend we call The Exodus to Affordable Lifestyle is still pumping, with large numbers of people relocating from the biggest cities to regional areas in pursuit of a different lifestyle at cheaper prices.

The latest data and analysis from a range of sources, including the ABS, Regional Australia Institute and real estate data company CoreLogic, confirms that this remains a major demographic force, with significant consequences for real estate.

And Queensland is the national leader in this category, gaining the most of any state or territory from internal migration in 2023 – that’s people moving from one part of Australia to another.

The only other state or territory to achieve a net gain in its population from internal migration was WA. All others were net losers – which means many Australians are relocating and most of them are going to Queensland for its climate, lifestyle and relevant affordability for homes.

This is being reflected in the price data. According to PropTrack, Brisbane unit prices have increased 17% in the year ending 30 June, while Regional Queensland rose 12% - while for houses, Brisbane rose 14% and Regional Queensland 11%.

This ranks both Brisbane and Regional Queensland among the best in the nation on capital growth – and the key factor is that all the indicators suggest that the out-performance of Queensland markets, generally speaking, is set to continue.

The latest government data shows that household wealth in Australia continues to rise and residential property is the main reason for that.

New data from the Australian Bureau of Statistics has shown that the wealth of Australian households has risen for a sixth consecutive quarter, with residential land and house prices the largest contributor.

The ABS figures indicate that household wealth on average increased 2.7 per cent in the March Quarter.

In raw numbers, our collective wealth increased by $431 billion - to reach over $16 trillion.

Those numbers are probably meaningless to most people – but the total wealth of Australian households is now 10 per cent higher than it was a year ago.

Residential land and dwellings were the largest contributors to quarterly growth in household wealth.

And the ABS figures show that, overall, residential property accounts for two-thirds of our wealth.

Dr Mish Tan, who is the ABS head of finance statistics, says that “Rising asset values continue to drive growth in household wealth, with house prices continuing to increase.”

Other ABS data shows ongoing growth in loans for the purchase of residential real estate.

And the growth in lending to buy property is occurring both for owner-occupiers, including first-home buyers, and for investors.

The figures emphasise just how important residential property is in the economic life of the nation and how the ongoing growth in property values underpins the financial fortunes of most Australian households.

Investors come to property markets in many different shapes and sizes, but our observation is that most are seeking a level of affordability.

The official data shows that most Australians seeking to buy investment properties are not wealthy, with most having incomes below $100,000, and most have just one property or are buying a rental property for the first time.

This dictates, for many, a purchase somewhere in the range from $400,000 to $600,000.

Fortunately, there continue to be options in regional Australia where buyers can access houses in this price range in locations which have good prospects for future capital growth.

Our day-to-day research shows that investors can buy in regional areas at affordable prices, achieve above-average rental yields and look forward to good price growth.

That old attitude that you have to make a choice between strong capital growth or high rental yields is one of the great misconceptions of residential real estate.

If you choose your location well, you can have a good combination of both.

Those seeking to buy in that price range between $400,000 to $600,000 can still find possibilities for houses in the cheaper areas of some of our capital cities – and, increasingly, investors who are aware of the current trends can find good options in the market for units and townhouses.

In cities like Brisbane, Perth, Adelaide and Melbourne, you can buy units in inner-city areas in that affordable price range.

The rise and rise of apartments and townhouses as the dwelling of choice for many important cohorts has meant that attached dwellings are increasingly challenging detached dwellings on capital growth, while providing cheaper buy-in prices and higher rental yields.

So, how can you find out more about the possibilities?

By reading our new Cheapies with Prospects reports.

We have two editions of the Cheapies reports – the city edition and the regional edition – and in these reports the key criteria are that the locations have affordable options and the credentials for capital growth.

The new editions are available now and provide clues to the places you can look to find that precious combination of affordability, good rental yields and potential for growth.

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The unfortunate reality is that the core problems afflicting housing markets don’t get fixed because politicians don’t understand the problems AND they’re unwilling to consult with the people who do.

If a state government gets the message that’s there’s a serious rental shortage, the only response will be to announce they’re going to build a million new dwellings over the next 10 or 20 years – which doesn’t address the core issue at all and is unlikely to ever be delivered anyway.

Politicians are incapable of coming up with anything else as a response to an immediate and pressing issue.

If a state government gets the message that housing affordability is a big issue, the only response will be to announce grants or stamp duty concessions for first-home buyers.

This, too, does not address the core issue – the high cost of housing in Australia and in particular the ridiculously high cost of building new dwellings – but it’s all they have in their kit bag of ideas.

And this speaks to one of the core issues for the dwelling industry – politicians appear to believe that the only people in society who deserve any consideration or assistance are first-home buyers.

And that’s reflected in the state and territory budgets delivered recently: a number of governments have announced measures to assist first-home buyers.

Tasmania has decided that first-home buyers will pay no stamp duty on a home costing less than $750,000.

South Australia has announced a similar measure, while Queensland says it will provide stamp duty discounts for first-home buyers paying less than $700,000 for a home.

From the viewpoint of first-home buyers, that’s better than nothing but it doesn’t address the very high cost of dwellings or the shortages that are causing prices and rents to rise.

And it doesn’t help anyone other than first-timers.

What about other real estate consumers?

What about second-time buyers? What about downsizers? What about investors who supply 90% of the homes that people rent, where there’s a chronic ongoing shortage.

Consider second-time buyers. They might be a young couple who bought a small apartment as an affordable first dwelling. But now they’re starting a family and need to upgrade to a larger home. There is no assistance and no concessions for them. The costs of selling and buying elsewhere are huge, with stamp duty a massive impost.

Politicians have often made statements urging older Australians to downsize – to sell the family home now that the kids are adults and have moved on, and make those family homes available to young buyers.

Apart from the daunting prospect of moving house, the big issue that stops many people from downsizing is the hideous cost of selling their home and buying elsewhere.

Based on the national median price for a house, the total costs of relocation can be around $100,000 – with a huge chunk of that being stamp duty on the purchase of the next home.

But most state and territories don’t recognise this reality.

Tasmania is an exception. It has a 50% stamp duty concession for pensioners downsizing.

If politicians were genuine and fully understood the issue, stamp duty would be abolished for downsizers.

And then we have investors, that cohort that politicians and journalists like to vilify and demonise – and misrepresent as greedy rich bastards ripping off the system.

The reality is that the typical investor buyer is young, earning less than $100,000 and is buying for the first time or owns one other property.

Landlords are in short supply and people need to be encouraged and incentivised to buy properties and make them available for long-term rental.

Right now, there are no incentives to take on that very big risk and burden in the hope of making gains in the future.

There are many, many disincentives, including land tax, capital gains tax, onerous state laws favouring tenants - and escalating costs, including interest rates, insurance premiums, council rates and maintenance costs.

These people need and deserve financial incentives – and, given that investors usually pay more in stamp duty than home buyers, it would be both wise and fair to provide stamp duty concessions or exemptions to investors to encourage more rental supply.

But don’t hold your breath. The thought would never occur to politicians, who appear to believe that the only cohort in the community that warrants assistance with the high cost of dwellings is first-time home buyers.

One of the core reasons the national shortage of dwellings is so serious is that it coincides with a record increase in the nation’s population.

The latest data shows that Australia’s population grew 651,000 in 2023, the highest number in the nation’s history.

84% of that growth was attributed to overseas migration.

Now, the record level of population growth last year did NOT cause the shortage of dwellings including the under-supply of rental homes.

The seeds of the shortage were sewn years earlier by bad government policy and have been exacerbated by bad governance every year since.

But that very high level of population growth has made a serious problem more dire.

Australia now has a population of 27 million, up 2.5% in 2023.

All states and territories recorded population growth during last year, although many of them were net losers of population to interstate migration.

It was overseas migration and natural increase that allowed the weakest jurisdictions to record increases, despite losing population from people leaving to live elsewhere in Australia.

New South Wales, the most populous state, did not record the biggest rise in numbers - Victoria added more to its population (186,491) than NSW did (185,459) both in raw numbers and in percentage terms.

Queensland also had a big rise, adding 141,378 people - because it had by far the largest net gain from interstate migration.

Notably, every state and territory was a net loser through interstate migration EXCEPT Queensland and Western Australia - which means lots of people are relocating and most of them are moving to Queensland or to WA.

WA in fact recorded the biggest population increase in percentage terms last year, rising 3.31%, followed by Victoria (up 2.78%) and Queensland (2.62%)

The places with the weakest growth were Tasmania and the Northern Territory, which both were net losers to internal migration but gained a little from overseas migration.

NSW made the biggest gains from overseas migrations but was the biggest net loser from internal migration.

So, what does all that mean for real estate?

Based on the population trends, where would you be buying real estate?

Based on these numbers, you would be focusing on Queensland and Victoria, as well as WA - although we continue to urge caution on the frenzied Perth market.

And where would you be avoiding? Tasmania and the Northern Territory, which both have weak economies and negative population figures.

But it pays to keep in mind that there is data to consider OTHER THAN population trends.

The most concerning thing about the unprecedented shortages which afflict Australian real estate markets is not that they are driving up rents and prices across the nation.

Alarming though that is for tenants and for first-home-buyers, the truly concerning thing is the myriad ways in which our elected representatives keep making those problems much, much worse.

Every time a state or territory government passes legislation or announces a policy move or hands down a budget which impacts on the rental shortage and housing affordability issue, they make it worse – not better.

This is the unsung scandal of Australian politics – that, at a time when the cost of living is such a big issue for so many people, the biggest single cost in the budget of most households (the cost of accommodation) keeps getting worse because our politicians keep making decisions that make it more and more costly.

In recent weeks we’ve witnessed the delivery of the Federal Budget and state and territory Budgets– and there’s not a single measure in any of those budgets which deals with the high cost of building and buying houses, or with the chronic shortage of rental properties which is causing residential rents to rise and rise.

But there are numerous measures in those state and federal budgets which, directly and indirectly, make those core housing issues worse.

And the big-spending pre-election vote-buying handouts in some of those budgets have added fuel to inflation which is likely to keep interest rates higher for longer.

If Australia had a news media worthy of its place in society, there would be headlines screaming about this every day.

What we do have, every day, is articles and commentary reminding us that there’s a shortage, items on the plight of tenants and on the lack of affordability in real estate – but there is little or no coverage of the steady flow of measures from politicians which continue to make all the problems worse.

And there has been little or no commentary on the reality that none of the budgets handed down in recent weeks contain any measures to directly address the shortage of homes available for rental.

Some state budgets have policies to build more social housing over the next 4-5 years, but nothing to address the immediate shortage of tenancies.

There has not been a single measure to provide encouragement or incentives to the people who provide over 90% of the homes people rent – private mum-and-dad investors.

What there has been, notably in the state budgets from the governments of New South Wales and Victoria, and in other policies they have announced, is a series of measures which increase the costs on the people who provide the product that’s in short supply, particularly with new or increased taxes.

The industry has sought to warn governments that measures like these will likely worsen the dire shortage situation by forcing investor owners to sell up – or further worsen the plight of tenants by forcing landlords to increase rents.

Investors owners have experienced massive increases in their costs recently, with higher interest rates, higher council rates, higher insurance premiums, higher maintenance costs – and, in the case of Victoria and NSW, major hikes in land tax and other taxes.

This has meant that rental properties that previously paid their own way are now in a serious loss situation. This forces owners to either sell or increase the price of the product they provide, which is a home for rent.

Victoria has exacerbated the problems in that state by introducing new requirements on the standard on the dwellings which will force owners to spend between $5,000 and $10,000 on upgrades.

This will tip many owners over the edge and force them the sell – and their tenants will lose their homes.

This is already happening. A new report has found that over 3,000 investors sold their Melbourne properties in May alone – and, across Victoria, almost 4,000 rental properties are listed for sale, according to Suburbtrends.

Given the strong anti-investor stance of the Victoria state government, the properties being sold are unlikely to be bought by investors, so they will be lost from the pool of rental properties – and vacancy rates will continue to fall, which puts further upward pressure on rents.

One of Australia’s most respected property analysts, Simon Pressley of Propertyology, has said his business will not recommend Victoria to investors until there was a change in attitude from the state government.

The firm is instead steering would-be investors to specific locations in other states.

He has warned that the lack of new investment in Victoria had made the situation for tenants “ugly”.

But it’s not only Victoria. It’s also happening in New South Wales, with thousands of investor-owned properties currently listed for sale.

The state budget in NSW includes significant increases in land tax – and, according to multi-award-winning buyers ‘agent Rich Harvey of propertybuyer, the changes will cause more investors to sell in NSW and will also prompt intending buyers to avoid NSW.

The NSW state budget also imposes a major Emergency Services Levy burden on property owners - and increases taxes on foreign investors, which will also have the impact of reducing rental supply.

The Property Council said the NSW budget bombshell “beggars belief”.

The Council’s NSW executive director Katie Stevenson says: “It’s a massive cost for property owners facing a once-in-a-generation housing supply and affordability crisis.”

The Australian’s wealth editor James Kirby commented that Sydney’s “prime position as the nation’s hottest property investment market is now in jeopardy”, with investors likely to be driven away from the city.

The national president of PIPA, Nicola McDougall, said about NSW: “This has come out of nowhere. It’s going to drive rents higher and it’s going to force investors to sell up, just like it has in Melbourne – I really wonder: does the NSW Government understand this?”

And my answer would be: No, they really haven’t got a clue. Or, if they do understand, they don’t care about the plight of the one-third of households in NSW who rent their accommodation.

In Queensland, where the State Government faces an upcoming election, the State Budget has thrown lots of electioneering cash at Queensland families to help them pay increasingly high electricity bills and for car registration fees, and there was a renters relief package – but there was nothing to increase the supply of rental properties and reduce the cost of building new homes.

The Queensland Budget stated the ridiculous objective of building a million new homes by the year 2046 – ridiculous because it’s based on the current government remaining in power for the next 22 years, when the polls suggest they won’t survive in government beyond the state election in October this year.

And, like other states, Queensland has slugged foreign investors with higher taxes – which will have the impact of further reducing rental supply and preventing the construction of major apartment buildings.

And so the process continues.

The rental shortage has been created from years of politicians discouraging, demonising and disincentivising investors – and they continue to make the situation worse for tenants with ongoing measures which punish investors and exacerbate the shortage.

The high cost of building new homes, whether they be houses or townhouses or apartments, has been largely, though not entirely, caused by imposts from various levels of government, including local councils, but in particular by state governments.

They keep changing the guidelines in ways that add to those costs and they keep slugging builders and developers with taxes, fees and charges – as well as mind-numbing bureaucratic delays which also add to the costs in times of high interest rates.

The result is that the standard house-and-land package is so costly as to be increasingly unaffordable for young buyers – and they keep adding more and more layers of cost, including the new construction code which adds up to $40,000 to the cost of building your standard brick and tile house.

As a society, we should be outraged by this. Our elected representatives have made housing increasingly unaffordable, both for purchase and for rental, and each passing month they make it worse, while blaming others for the problems.

According to our national newspaper, The Australian, the fact that property prices have continued to rise in spite of higher interest rates is, and I quote, “weird” – and apparently the people described by the newspaper as “experts” are scratching their heads about it.

The article that contained this nonsense was just another plank in the ever-growing pile of misinformation about real estate issues perpetrated by economists and journalists who don’t allow their ignorance of property issues to prevent them from commenting about them.

Journalist Anthony Keane is the personal finance editor at The Australian. And given that he has a fancy title and he works for this major standard-bearer Newscorp publication, the national newspaper, we the readers are entitled to expect him to know something about the subjects on which he pontificates.

Sadly, he does not.

In claiming that it’s unusual, indeed “weird”, for prices to rise when interest rates have increased, he is demonstrating that he’s not a student of history and he doesn’t waste any time on research before banging away on his computer keyboard.

He simply regurgitates the outpourings of economists who subscribe to the kindergarten analysis view that falling interest rates mean property prices rise and rising interest rates mean property prices fall.

That pretty much sums up the views of senior economists working for the big four banks and others like them. They continue to believe that interest rate trends dictate everything in real estate, although there is a mountain of evidence that confirms this is not the case – notably in the past 18 months.

Many of Australia’s most spectacular property booms have occurred during times of high and and rising interest rates, including in the late 1980s and the early years of this century, when mortgage rates were higher than now and rising, but market activity and prices kept on increasing.

Last year, we had the RBA continuing to lift the official interest rate – we saw a total of 13 monthly rises by the time they paused – and yet we had substantial price growth nationally, including boom-level price increases in several of our capital cities and also in several regional markets.

According to Anthony Keane, this represents what he calls “a new world of weirdness”.

The reality is that it’s not weird, it’s quite normal.

And the people who are apparently “scratching their heads” about it are not experts. If they had expertise, they would understand the dynamics in real estate markets and be unsurprised at the price outcomes.

People who are really bad at predicting housing markets and price outcomes, like the big bank economists, would rather claim the market is wrong than admit that they are.

The past 18 months in real estate has not been an aberration or a unprecedented maverick event – it’s simply another demonstration of the reality that interest rate events are NOT the prime influence on trends in real estate.

Right now there are far more powerful forces in play, including the imbalance between supply and demand.

So, is this (as suggested by The Australian) a new world of weirdness?

No, it’s not, it’s simply business as usual in property markets across Australia, in which interest rates are a factor but not a particularly powerful force – in times when the biggest influence is the shortage of everything important in real estate at times of high demand, causing prices, rents and yields to rise in good locations.

Far from this being a case of “weird is the new normal”, normal continues to be normal.

The new 2025 Financial Year is upon us and, as we do every year, we are making special offers to real estate consumers and to our business customers.

One of the key factors for success for real estate investors is basing decisions on quality research.

As we launch into the new financial year, it’s crucial to have the best information at your fingertips.

To help set up investors with a suite of reports that cover all the key bases, we’ve put together a bundle of reports that nominate great locational options for capital growth, for rental yields and positive cashflow, as well as our Australian Property Guide that provides information about the key rules and costs like stamp duty in each state and territory.

So this special bundle provides the new edition of National Top 10 Best Buys, as well as National Top 10 Positive Cashflow Hotspots report and the Australian Property Guide at a price that saves you $248 if you bought each of those three reports separately.

Having these three reports gives you a major head start on the competition for the best places to buy in Australia in FY2025.

For real estate professionals we have two key membership products, Property Pro and Enterprise.

These provide a range of features, including access to our new one-stop-shop research portal, all our hotspots reports and a range of other key benefits.

Our EOFY special deals provide a saving of $1,500 for the Property Pro membership and an annual saving of $3,000 for the Enterprise membership.

Overall, it’s a package of special deals that has something for everyone, whether you’re an investor who wants to buy, an investor who plans to sell or a real estate professional with a business seeking to provide the best advice to customers.

And if you want to take advantage of these offers, you need to take action this week – as the special deals expire on June 30.

The most successful property investors have some features in common - and making decisions based on genuine research is one of the key ones. But those people are relatively rare.

My observation of the behaviour of investors over four decades shows that more people make investment decisions based on media soundbites than on real research.

And, as we embark on a new financial year with all kinds of competing forces in play in real estate, it’s more important than ever that real estate consumers base their decisions on research, rather than media frenzy and herd mentality.

Far too many people are leaping recklessly into the Perth property market because mainstream media keeps telling them that prices are booming and will keep on doing so, backed by commentary from real estate people who have a vested interest in prolonging the boom.

At Hotspotting, we think this media soundbite approach is fraught with peril and that many of the people diving into the Perth market - grabbing anything that’s for sale and paying more than the asking price, without regard for the quality or location of the property - will regret their decisions made in haste without proper due diligence.

It’s a reflection of those views that our new edition of the National Top 10 Best Buys report does not include any locations in Perth. Based on detailed research, we think this market has peaked (after three years of major price growth) and will not be the national leader on capital growth in FY2025, as some are predicting – or hoping.

We think there are other, better places for people to be putting their money – safer, less volatile, less heated markets with good potential for capital growth. Well-researched investors buy in areas with growth credentials BEFORE prices escalate.

Our choices for good locations to buy in FY2025 are based on research-based knowledge of the key trends driving demand in the best locations across Australia.

We’re not focused on short-term sugar-hit gains; we’re focused on places we think will do well in the medium to long term. We base our choices on economic factors, demographic trends and on the locations of influence from big infrastructure developments.

At Hotspotting, we are constantly on the look-out for evidence of change in property market trends and individual locations.

Places that have been weak performers on capital growth in the past can become the leaders of the future because something major has changed in that market – often caused by the development of major new infrastructure.

Sometimes it’s a significant demographic shift – such as the trend that has seen large numbers of people leaving the biggest cities and moving to smaller cities or to regional areas, in search of a different and more affordable lifestyle, enabled by technology.

In the past 12 months we have observed a surge in demand for units and townhouses by a range of buyer cohorts, for a host of different reasons – and this is changing one of the dominant paradigms of real estate: that houses outperform units on capital growth.

We have also seen he re-emergence of markets that had exceptional price growth from 2020 to 2022, have had 18 months of correction or flatlining and now are starting to grow again. We call them “the second wind markets”.

Real estate is dynamic, with change as a constant: if you read the new edition of our National Top 10 Best Buys report, you will know about all the key trends that matter in the new 2024-25 financial year.

The report we call The Pulse provides critical intelligence for property investors because it shows how you can get both a high rental yield and excellent capital growth if you choose your location well.

Recent editions of The Pulse have featured locations where rents have grown 10-15-20% in a year, but so have property values – providing the ultimate win-win-win situation for property investors.

Hotspotting produces this report in association with leading national experts on property depreciation, Washington Brown – who provide additional key elements to the data in this report.

The figures from Washington Brown show that intelligent application of depreciation tax benefits can create a significant increase in the rental yield of your property.

It depends on a number of factors, including the tax bracket you are in, but typical depreciation benefits for an investment property can lift a 6.3% gross rental yield to 6.75%.

A 6.4% yield can improve to 6.8% or 6.9%.

Tyron Hyde, the CEO of Washington Brown says that “Depreciation is the secret sauce when it comes to property investing - and can turn a good, positively geared property into an even greater property!

“Better yet, depreciation can turn a negatively geared property into a positively geared scenario.”

Tyron Hyde reminds us that property investors are able to claim the wear and tear of a property against their taxable income, which should be factored into the yield of a property.

Depreciation is a non-cash deduction, which means, unlike all other expenses on your property, you don’t have to pay for it.

The depreciation amount you can claim is built into your property when you buy it; you just need a Quantity Surveyor like Washington Brown to calculate the number.

So, if you get a copy of The Pulse, you can learn a number of key things for property investors: 50 locations which are affordable, where you get above average rental yields, and which have good potential for capital growth – and the important data from Washington Brown which shows how depreciation benefits can turn a good rental yield into a great rental yield.

Victoria has become the state that property investors don’t want to know about, because its politicians at both state and local level appear to have declared open season on investors.

The State Government in Victoria has a budget deficit problem and has made the decision that many politicians in Australia make, which is to resort to the housing market as their favourite cash cow.

They can’t slug home-owners or first-home buyers with new or higher taxes because that’s politically unpalatable – but investor owners are relatively few in number so they can attack them with less damage politically.

It will result in fewer investors, therefore fewer rental properties, and therefore higher rents for tenants, but hopefully (in the minds of the state politicians) tenants will blame their landlords rather than the government.

So the State Government in Victoria has smashed owners of investment properties in the state with big increases in existing taxes – notably land tax – and with the introduction of new taxes.

It’s almost as if they see investors as a criminal class and they all need to be punished.

If that isn’t enough, now the State Government has announced it will mandate the upgrade of a range of components inside rental homes

This would force landlords to install insulation, draught-proofing, cooling and heating systems and new shower heads – and the estimates for the cost impact of that range from $5,000 to $10,000.

Consumers Affairs Minister Gabrielle Williams, displaying the out-of-touch divorced-from-reality quality so common among politicians, says this is a relatively small cost for property owners to wear and won’t be a problem for anyone.

But for typical owners, an additional cost of $5,000 or $10,000 on top of huge increases in interest rates, insurance, maintenance costs and government taxes including land tax and council rates, this is a killer blow.

There is already an exodus of investors from Victoria because of the recent tax increases and this new imposition of enforced upgrades will compel many more to sell up and leave the state.

Veteran property commentator Jonathan Chancellor has described the Victorian State Government measures as “a lesson in what not to do” in the face of a rental shortage crisis.

He said that the state bureaucracy had admitted that Melbourne’s rental supply may contract as a result – keeping in mind that it’s already alarmingly low.

But it doesn’t end with this appalling state government. Local councils have already joined the increasingly popular political sport of demonising and punishing investors.

The Merri-bek Council, or elements of it, want to take the assault on property investors to a new level. The plan is to double council rates on investment properties and reduce rates for everyone else.

They say that, if it forces investors to sell and their properties are bought by owner-occupiers, that’s a great thing. In fact, according to the policy stated by the proponent, Cr James Conlan, that’s the main objective.

The logic, if you can call it that, is that it will make homes available for purchase by first-home buyers. But most suburbs in this LGA have median house prices well above $1 million. The three Brunswick suburbs are all around $1.3 million.

How many first-home buyers in Melbourne can pay over $1 million as their first foray into the property market.

It’s simply not going to happen.

But, beyond that, where will the tenants of these properties go? Who will provide the rental properties if the local council forces all investor owners to sell, which appears to be the ultimate objective of this appalling proposal.

Vacancy rates in the postcodes of Merri-bek LGA are well below the already-low Melbourne average – many of them have vacancy rates around 0.5%, which is at crisis levels.

Looking more broadly across the state, the number of homes occupied by renters in Victoria has fallen by 10,400 in just three months and 15,600 in a year.

Government agency Homes Victoria’s most recent rental report, from the March quarter, reveals that the number of new lettings has dropped 12% in a year.

The rental supply fall has coincided with a shortage of new homes being built, because of labour and supply constraints.

It also coincides with an increase in land taxes paid by landlords and follows 13 interest rate rises since 2022.

Australian Bureau of Statistics figures released earlier this month revealed that housing loans taken out by investors in Victoria were well below the national average amid an exodus of investors from the property market.

Ultimately, in the end, who are the biggest losers?

Well, it’s the people who rent their homes. There is going to be considerably fewer of them in Melbourne and other parts of Victoria and there will continue to be upward pressure on rents.

Unless, of course, someone is silly enough to implement a rental cap, which will cause even more investors to sell and create an even bigger rental shortage.

A rental cap is no use to you if you can’t find a place to rent at any price, because nothing is available.

There are many so-called research reports in Australia which do a very poor job of providing useful, accurate, credible information to consumers – but the worst of the worst is a report called Demographia which pops up once every year to misinform Australians about affordability.

This report, which is a shameless propaganda exercise by a developer lobby group, sets out to portray Australia as a place where no one – and I do mean no one – can afford to buy real estate.

The lobby group is apparently trying to convince governments across Australia that the development industry is over-regulated and that this over-regulation is causing unaffordable housing everywhere – and I do mean everywhere – in Australia.

This ridiculous report has been claiming for 20 years that the whole nation of Australian is unaffordable.

And the latest edition of the report claims that significant chunks of Australia are and I quote, “impossibly unaffordable”.

Now, think about it for a moment. If this was true, no one could afford to buy homes in Australia at all. Because, essentially, that’s what they’re claiming - that no one can afford to buy real estate.

Clearly, that’s a ridiculous and preposterous claim because all over Australia there is a high level of sales activity and prices continue to rise in most locations.

The latest official lending figures show that loans to owner-occupiers, to first-home buyers and to investors have all risen substantially in the past 12 months.

There is high demand for homes and for investment properties and the high level of sales is causing prices to rise in most locations.

Now, none of that would be possible if the Demographia report was credible and accurate – because it says the whole country is unaffordable.

Indeed, it says our major cities are the most unaffordable in the world.

But here’s the thing – the report doesn’t cover the world. It only compares Australia will a tiny proportion of the nations on the planet.

There are over 200 countries in the world – and how many are included in this report? Just seven. Australia and six others.

And yet it maintains that it can justify the claim that Australian cities are the most unaffordable in the world.

Now, if common sense prevailed, you and I wouldn’t even be aware that this report exists because it’s so implausible and lacking in any merit whatsoever.

But we DO know about it because news media in Australia doesn’t care about ethics or accuracy or fairness or credibility.

Journalists, sadly, care only about the headline and don’t care that the information on which the headline is based is patently, blatantly and obviously false.

Michael Bleby, who apparently is the Deputy Property Editor for the Australian Financial Review, was happy to report that Sydney, Melbourne and Adelaide are all “impossibly unaffordable” and ran the headline “Impossibly unaffordable housing a social risk”.

Bleby stated that Sydney is the world’s second-least affordable city for housing, based on the content of the Demographia report.

Now, I’m assuming that Bleby has seen the report, because it would unprofessional and unethical in the extreme to make such claims without looking at the evidence.

So I can only conclude that he doesn’t care too much about the substance of what he is writing, so long as it generates clickbait.

News Corp journalist Aidan Devine put his name to an article that stated that three of our capital cities were ranked in the top 10 most unaffordable housing markets in the world – and then claimed that Australia was the least affordable housing market in the English-speaking world.

So these journalists and others were happy to make these outrageous claims despite what the facts show us.

I’ve read half a dozen different articles on this and only one of them mentioned, briefly, the small number of countries in the report.

In Sydney, claimed by the report to be “impossibly unaffordable”, there were 73,290 homes sold to buyers in the past year. And the median house price rose 8.2% in the past 12 months, according to CoreLogic.

In Melbourne, also claimed to “impossibly unaffordable”, 86,200 homes changed hands in 12 months, with house prices rising 2%.

And in Adelaide, which is actually one of our most affordable capital cities - but also dubbed “impossibly unaffordable” by this shameless document - over 20,000 houses and apartments were purchased by buyers who were apparently unaware that the homes they were buying were utterly unattainable.

And Adelaide house prices rose 14.3% in the past year, according to CoreLogic.

So, if they were impossibly unaffordable before, they must be catastrophically unreachable now, after a further 14% increase in prices overall.

Clearly the report on which all that media hot air is based is laughably and demonstrably rubbish.

But you can sure that this time next year it will pop up again and come up with new sensationalist claims that aren’t supported by any scientific evidence – and our hopelessly shabby news media will be happy to publish it, because they don’t give a toss about providing you with real information and useful data.

In this episode of "No Money Down: Smart Property Investment," Tim Graham is joined by Lucky Velasquez, the founder of FinanceBetter, to discuss innovative strategies for property investment with minimal initial capital outlay.

Lucky shares his extensive experience in helping clients navigate financial hurdles and maximise their investment potential without the need for large upfront deposits.

Key Topics Covered:

Introduction to No Money Down Investing: What it means to invest with little to no initial capital. Common misconceptions about no-money-down strategies.

Creative Financing Solutions: Alternative financing options and how they can be leveraged. Examples of successful no-money-down deals and the creative methods used to structure them.

Risks and Rewards: Analysing the potential risks and rewards of no-money-down investments. How to mitigate risks through thorough research and due diligence.

Market Insights and Trends: Current trends in the Australian property market. How economic conditions are shaping investment opportunities.

Case Studies and Real-life Examples: Detailed case studies from Lucky's clients who have successfully implemented no-money-down strategies. Lessons learned and actionable tips for aspiring investors.

To get in contact with Lucky, please visit www.financebetter.com.au

Are you ready to take your investment journey to the next level?

Look no further, because we have exciting news to share with you! We are thrilled to announce our new Hotspotting pre-recorded interviews with some of the top 1% of Australian investors who own 5 or more properties.

As you may know, in the 2020-2021 financial year, only 0.87% of investors in Australia owned 5 or more investment properties. But what do these successful investors know that the majority don't? We have sat down with a number of them to get exclusive insights into their strategies, tips, and personal journeys.

Our pre-recorded interviews bring you valuable knowledge and advice from Australian property experts who walk the walk and practice what they preach. Learn from their mistakes, successes, and unique perspectives on property investment. These interviews are a must-watch for anyone looking to build a successful investment portfolio and achieve financial freedom.

With over 71% of investors owning only one investment property, we understand the challenges and uncertainties that come with growing your portfolio. That's why we have curated a series of interviews that exclusively feature investors with multiple properties. They represent the top 1% of Australian investors and have achieved remarkable success in their investment journey.

Our pre-recorded interviews are available for you to watch at your convenience, so you can take in all the knowledge and insights at your own pace. Hear firsthand how they navigate the ever-changing property market and make profitable investment decisions. You'll be able to walk away with practical tips and strategies that you can implement in your own investment journey.

About Melinda Jennison

From a very young age Melinda developed an interest in real estate because her parents were property investors, so she learnt a lot from the conversations that they often had growing up. Melinda says she has been fortunate to have never rented, but instead bought her first home in Brisbane at the age of 18. This was the beginning of her own property journey.

Melinda came from a research background, having completed a PhD in 2001. Instead of staying in academia she moved into real estate, with involvement in the building and construction industry and property development. Now as a buyers advocate and QPIA®, Melinda uses the skills she has acquired over the years to make evidence based property decisions, to accurately interpret data and translate that in an easy way for clients to understand, and analyse all sorts of property deals for herself and others.

In September 2023, Melinda’s outstanding expertise in the property sector was recognised when she was elected President of the Real Estate Buyers Agents’ Association (REBAA).

You can find out more about Melinda and Streamline Property Buyers by visiting https://streamlineproperty.com.au/

Home builders and property developers make their money creating new dwellings for Australian households.

If they get it right, they can make lots of money doing what they do.

When they decide NOT to do what they do, you have to ask why.

Why are the builders of major projects of housing or apartments walking away from their plans?

Why are big companies who have spent years and millions of dollars planning a major project making the decision not to build it?

We’ve seen many instances recently. An example is the decision by AVJennings to abandon a major housing development near Caboolture in the outer northern suburbs of Greater Brisbane. This project would have added 3,500 new homes to a market where there is a desperate shortage.

Brisbane is a market with high demand and a serious shortage of homes. Why would a big developer with a proven track record and the capacity to deliver these kinds of projects make the very big decision to walk away from the project?

All that time and money wasted.

The answer is: it’s simply not viable.

AVJennings said massive cost escalations – including the infrastructure charges and delays in getting approvals imposed by local councils – meant the project was no longer viable.

I have had discussions recently with developers who say that the cost of creating big residential projects is so high, it’s not economically and financially feasible.

They would have to place such a high price on the end product that few households would be able to afford to buy the homes.

A number of developers have spoken out about the impact that the cost impositions of local councils have on making projects difficult or unviable.

Orchard Property Group managing director Brent Hailey says the major infrastructure costs imposed on them make it too expensive for them to build homes.

Hailey said that, for example, developers in that Caboolture West precinct that AV Jennings has rejected had to pay for council infrastructure charges and also state government charges because it’s in a Priority Development Area.

Hailey says: “We’re at this point now in SEQ where unless the solutions are put in place quickly, there’s going to be a rapid decline in affordability, forced by supply not meeting demand.”

He says: “The problem facing developers is the cost of delivering the infrastructure and the balance between fully servicing those costs and trying to get an affordable home. There’s the normal council charges and the Priority Development Area (PDA) charges. During Covid-19 costs went through the roof, so now infrastructure is costing a lot more.”

Here’s another issue which is preventing the creation of affordable homes in Australia.

Prime Minister Anthony Albanese’s pledge to build 40,000 affordable homes through the Government’s $10bn housing fund will struggle to deliver any houses at all in Labor’s first term of office because only a handful of builders in Australia are eligible to participate in the program.

Rules written into the Housing Australia Future Fund legislation require builders contracted to work on new social and affordable homes under the scheme to be accredited for working on government-funded projects.

However, of the more than 400,000 construction companies registered in Australia, only around 500 are accredited by the Federal Safety Commissioner under the Work Health and Safety Scheme for eligibility to bid for head contracts funded directly or indirectly by the government.

There are few if any residential builders accredited under the scheme in Tasmania and only a limited number in regional Australia.

The industry claims the limitation threatens to severely hamper or stall Housing Australia’s ability to deliver its target of 40,000 social and affordable homes.

This comes at a time when the new construction code being imposed by governments is adding $30,000 to $40,000 to the already-high cost of building new homes in Australia.

These are just the latest events adding to a substantial list of situations which create the inevitable conclusion that we have a serious housing shortage in Australia, and very expensive new homes in this country, because of the short-sighted policies of politicians at all levels of government.

Home loans to property investors jumped for a third-straight month in April, rising at a faster pace than loans to owner-occupiers.

The value of new loans to investors rose 5.6% to $10.9 billion in April, to be up 36% compared with a year ago, according to the Australian Bureau of Statistics.

Part of that increase, according to the ABS, is an increase in the size of the average loan.

The average size of an investor loan for the purchase of an existing home grew almost 10% since April 2023, from $592,000 to $648,000.

The strongest markets were New South Wales (where investor lending increased 44%) and Queensland (where investor lending climbed about 46%).

The higher rate of investor activity comes at a time when rents continue to rise, underpinned by very low vacancy rates, to compensate (partly, at least) for higher interest rates, as well as higher council rates, higher insurance costs and higher maintenance costs.

Figures from property consultancy CoreLogic earlier this month showed rents recorded an annual rise of 9% in Sydney and 10% in Melbourne – which means rents in the two big cities are rising faster than prices at the moment.

The rate of price growth is higher in smaller capital cities like Brisbane, Adelaide and Perth, but rental increases are as high, or close to being as high, as the rise in sales prices in those cities.

CoreLogic research director Tim Lawless says: “For most investors, higher yields will be welcome considering variable interest rates for investor loans are averaging 6.7%.

“Given the high cost of debt, a large portion of leveraged investors are probably recording a cash flow loss despite the substantial rise in rental income.”

The increased activity from investors is welcome, after a period of being well below historical averages – which, in simple terms, is why we have a rental shortage, given that investors provide over 90% of the homes rented by tenants in this country.

The rise in buying activity by investors confirms the anecdotal evidence we have seen at Hotspotting.

Right from the start of 2024, we have observed that many investors started this year with intent – and are taking action.

This is desperately needed across Australia, as it’s the only way that the chronic shortage of rental homes will be improved.

Where’s the strongest suburb for future price growth in Australia?

What’s the most consistent location for sales activity in the nation and therefore likely to deliver superior price growth?

And what’s the absolute worst place to buy real estate right now?

The answers to all those questions and a whole lot more are revealed in the new Winter edition of The Price Predictor Index.

Now, we publish a lot of great reports with unique insights into property markets across Australia - but this is undoubtedly our best report.

The thing that’s so special about this report is that we do something that no one else does in Australian real estate - we chart trends with sales activity and use that to predict likely future movements in prices.

We apply a rating to every suburb and town in the nation - whether the market is rising, or recovering, or fading, or declining.

Our analysis of this data allows us to pinpoint the locations with the strongest trends in real estate across Australia - the ones most likely to deliver superior price growth.

We also identify the places to avoid, the ones where market trends are negative.

We pinpoint the best clusters of growth suburbs in the nation - the local government areas where suburbs collectively have the most positive trends with buyer demand.

We also identify the winners and losers among the big market jurisdictions - the eight capital cities and six state regional markets.

It’s fair to say that many of the findings will surprise a lot of people.

There is so much priceless market intel in this one report - so, if you buy just one research report this year, this is the one to get - the new Winter edition of The Price Predictor Index.

I’m about to tell you what’s going to happen with property prices this year and I’m going to tell you why.

The information real estate buyers MOST want to know is where to buy for superior capital growth, both in the short term and the long term.

The problem for investors is that the research companies and the media don’t tell us that.

They tell us what’s recently happened with property prices. They inform us about the past.

And while that may be interesting, it doesn’t provide us with the really key information: what will happen with prices in the future.

That’s where Hotspotting comes in. Our proven methodology has a track record of predicting the future successfully and often.

And one of our core techniques is used to create the best of our stable of reports: The Price Predictor Index.

The underlying principle is really simple but wonderfully effective.

We don’t spend our time charting price movements - we devote our resources to following what’s happening with sales volumes - the number of sales in each location and whether they’re rising, flatlining or falling.

History tells us that sales activity is a forward indicator of what will happen with prices.

And the new Winter edition of the report provides important clues about which markets are rising and which ones are falling.

Here are some of the key pieces of market intelligence that our new analysis provides:-

The Perth boom has likely peaked and we urge caution for the many investors diving into this market after three years of big price growth.
Melbourne prices will perform a lot better in 2024 than they did in the past two years.
Some of the regional markets have stepped up as likely national leaders on price growth in the next 12 months. They include places like the Wollongong region, including in particular the Shoalhaven LGA; Gladstone in Central Queensland; and Albury-Wodonga at the Victoria-NSW border.
Smaller capital cities which have been weak lately are showing solid signs of recovery and will do better in the next year, including Canberra and Darwin.
Some of the iconic markets which had spectacular booms up to 2022 and have been in a correction phase since then, are now showing signs of moving into their next up-cycle. They include Byron Bay, the Sunshine Coast and the Mornington Peninsula.
Other former boom markets that look to be heading into another period of growth include Albury-Wodonga, Ballarat and Bendigo in Victoria, Hervey Bay in Queensland and Launceston in Tasmania.
Apartment markets in good locations in our biggest cities continue to attract buyers in large numbers with improved capital growth performance - Sydney City and the Inner West nearby are among the stand-outs.

The Winter edition of The Price Predictor Index has other priceless intel - including the National Top 50 Supercharged Suburbs list, the 50 most consistent growth markets in the nation, the 10 leading local government areas in Australia and the 50 worst declining markets, the ones to avoid.

From these lists, we nominate the No.1 best supercharged suburb, the nation’s most consistent location which is delivering big price growth - and the worst place to buy right now.

And, if you want to know what they are, you’ll need to get a copy of the report.

Are you ready to elevate your property investment game? Join us for an exclusive webinar titled: "From Beginner to Pro: Mastering the Art of Commercial Property Investment." This insightful session is designed to equip you with the knowledge and strategies needed to thrive in the commercial property market. About the Webinar Hosted by Tim Graham, General Manager of Hotspotting.com.au, and featuring guest speaker Steve Palise, owner of Palise Property, this webinar will delve into the intricacies of commercial property investment. The author of 2 books and creator of The Commercial Property Institute, Steve, who retired before the age of 30 thanks to his impressive property portfolio, now dedicates his expertise to helping others achieve financial freedom. His analytical approach, rooted in his background as a chartered mechanical and structural design engineer, provides a unique and practical perspective on property investment. Key Topics Covered

What is Commercial Property?
Understanding the basics and significance of commercial property.
Difference Between Residential and Commercial Property Key distinctions and their implications for investors.
Myths of Commercial Property Debunking common misconceptions and myths.
Benefits of Commercial Property Exploring the advantages and financial potential of commercial investments.
Risks of Commercial Property Identifying potential risks and how to mitigate them.
When is Commercial Property Right for You? Assessing if and when commercial property aligns with your investment goals.

To take advantage of Steve's amazing offer of enrolling in The Commercial Property Institute's online course for FREE for a short-time only (usually $4,997), visit www.commercialpropertyinstitute.com.au and use the code word HOTSPOTTING

It’s important for property investors to understand the difference between a population and home building hotspot – and what we at Hotspotting would define as a property growth hotspot.

There are those who believe that the best philosophy in selecting good places to buy real estate is to follow the population growth – and buy in the locations where population is growing the most or the fastest.

This, we believe, is a very poor strategy.

Very often, the locations that have the highest population growth rates do so simply because they’re locations on the fringe of a major city where there’s land available for building new housing estates – and naturally the population will grow there, often from a very low base.

And sometimes the growth in prices in these kinds of locations is subdued because there are large quantities of new housing supply being created – i.e. there’s an absence of shortage.

By contrast, some of the best capital growth is often achieved in locations where there is little or no population growth – because they’re established suburbs with no large vacant areas for new homes to be built.

The only way the population can grow in such places is by increased density – for example, houses are knocked down and replaced by apartment buildings.

Recently the Housing Industry Association published its latest hotspots report – and their definition of a hotspot is very different to ours.

The HIA report seeks to identify the areas where the greatest amount of new population and new home construction is occurring.

Media reported on this with headlines such as: “Population Boom Creates Hotspots”.

A typical article said:

“Surging population growth is creating housing hotspots in the suburban outskirts of Australia’s major capital cities.

“The annual Housing Industry Association Population and Residential Building Hotspots Report says the northwest Sydney suburbs of Box Hill and Nelson are Australia’s biggest hotspots for construction, followed by Fraser Rise and Plumpton in Melbourne’s west.”

Now, this is a perfectly valid report for the HIA to produce, because it speaks to the primary activity of its members, the important business of creating new dwellings – something the nation needs, because there’s a serious shortage.

The HIA definition of a hotspot is “areas where population growth eclipses the national rate of 2.4% and building work is worth more than $200 million”.

But it’s important to understand that such places are not necessarily good places to invest.

The Hotspotting definition of a hotspot is a place where there are underlying economic factors likely to create superior capital growth in the medium to long term.

Our EMPERICAL formula for selecting the locations likely to become capital growth hotspots includes the strength and depth of the economy, the size of the population (but not how much it is growing), the existing infrastructure and amenities, investment in new infrastructure and a number of other features.

Locations that satisfy the various criteria in our EMPERICAL formula are far more likely to deliver superior capital growth than city fringe locations where the population is growing fast through new housing estates.

A podcast by people who make a difference, with people who are the difference. Listen to how incredible people live life on their terms.

Chris Christofi, entrepreneur, is the brain-child behind this brilliant podcast. He talks to multiple World Champions, CEOs of major property development companies, brand innovators and unexpected entrepreneurs about their journey listening to their mindset, their gratitude and their unceasing intensity to get to the top.

Chris pays it forward unveiling the secrets to their success to ensure listeners learn from the best. If you want to level up your inner game, watch Relentless on YouTube or listen wherever you listen to your podcasts.

About This Episode

From humble beginnings growing up in a country pub, it was a fateful meeting between Tim and our very own Chris Christofi that set Tim on a whole new path. From travelling all around the world selling real estate, to becoming the COO of Reventon, and finally the General Manager of Hotspotting with Terry Ryder, it's been a meteoric rise for this kid from the country. A long-time friend of the Reventon business, Tim sat down with Chris to talk about his journey, gaining the respect of clients and the challenges of selling real estate in 18 different countries.

Join Terry Ryder & Tim Graham as they reveal the powerful EMPIRICAL Formula used to identify the Top 50 Suburbs for above-average rental yields and outstanding capital growth.

Discover how our formula has consistently delivered remarkable results, with some areas experiencing up to 30% growth in the past year.

Webinar Highlights:

The EMPIRICAL Formula: Learn the methodology behind selecting top-performing suburbs. Proven Results: See the impressive outcomes from following our tips, including double-digit capital growth in the latest quarter alone.

Top 50 Suburbs: Discover locations with high rental yields (5-8%) and property appreciation rates (10-15%).

Case Studies: Explore success stories like Orelia in Perth (17.9% increase in three months), East Mackay in Queensland, and Kingston in southern Brisbane. Exceptional Performance: Uncover 11 suburbs with over 20% growth in the past year.

Regional Standout: Dalby, Queensland, with a 24% increase in rental yields and a 15% rise in property valuations in the last 12 months. Ideal for:

Serious Property Investors Real Estate Professionals Mortgage Brokers Financial Planners Buyers Agents Investment Advisors

For more information on our Hotspotting reports please visit www.hotspotting.com.au/reports And for more information on memberships visit www.hotspotting.com.au/memberships

The misuse of price statistics represents a clear and present danger for real estate consumers trying to make choices about where to buy.

The much-quoted adage about lies, damned lies and statistics applies very aptly to median prices for locations across Australia.

While this data can be useful to buyers and sellers, if used intelligently, way too often it’s misused and abused in news media in ways that misinform and mislead consumers.

One of the most common misuses of median price data occurs when media outlets publish lists of the locations which, allegedly, have had the biggest growth in property values in a recent time period.

Journalists love these lists, usually spat out of the computer database of a research organisation which craves free publicity and doesn’t care too much about the accuracy or authenticity of the figures.

One of the problems is that journalists often confuse a 10% rise in the median house price with a 10% rise in the location’s property values. Often it’s not the same thing at all, because median prices are very rubbery figures.

Here are a few facts about median prices you need to know about:-

If you do a computer search on the median price for any suburb or town in Australia, you might get answers from seven or eight different sources and they will be all different.
If you ask how much the median house price has grown, or fallen, in the past 12 months, you again will often get seven or eight different answers.
Median prices are notoriously and dangerously unreliable if the sales sample is small. If, for example, there have been only nine or ten sales in a suburb or town in the past year, then the median price will be meaningless, and the increase or decrease will be unreliable, because that’s a very small sales sample.
At Hotspotting, we disregard median price data for a location if there are fewer than 30 sales in a year.

So recently, a recent media headline shouted very loudly about a New South Wales location where “property values” had risen 150% in the past five years – including 8.2% in the past 12 months, according to CoreLogic – which is one of those research organisations which loves free publicity and doesn’t always scrutinise the data that achieves it.

The reality is that the location in question, Catherine Hill Bay in the Lake Macquarie area, is a very small village with very few sales – and the figures on its median house price cannot be treated as gospel.

According to the article, the median house price was $1.43 million, according to CoreLogic, up 8.2% in 12 months and 151% in five years.

But if you check out the latest figures on yourinvestmentpropertymag.com.au, the median house price is $1.56 million, up 5.7% in the past 12 months – and has grown at a rate of 25% per year over the past 10 years – which means property values are doubling every three years.

If that was true, this insignificant location would be the outstanding real estate performer in the nation, if not the world.

But PropTrack’s latest information says the median house price is $1.6 million, up 10% in the past 12 months. But with little increase in the past two years.

But here’s the thing. How many house sales in Catherine Hill Bay in the past year?

Just 10. Which means the median house price data is rubbish.

If you look at the PropTrack graph for the change in its median house price over the past five years, the figures jump all over the place – because there are so few sales.

The message is: if you torture statistics enough, they’ll tell you anything you want to hear.

But smart investors will not base a big purchase decision on this kind of data.

It’s a common myth that an investment property can’t have both strong rental yields and capital growth.

Our data shows us time and time again that BOTH outcomes are possible, and no report illustrates it better than ‘The National Top 10 Positive Cashflow Hotspots Report’.

Investing in real estate is all about timing and choosing the right locations that promise substantial returns.

Our latest edition of the National Top 10 Positive Cashflow Hotspots report reveals the insights you need to make informed decisions and maximise your investment potential.

Our Previous Scorecard Our tips from last year had some remarkable growth in both property values and rental yields in these suburbs, reinforcing their attractiveness as investment destinations.

Here's a glimpse of the standout performers:

Armadale (W.A.):

12-month Capital Growth: 31.30%

Rental Growth: 28.20%

Withers (W.A.):

12-month Property Growth: 30.70%

12-month Rental Growth: 12.50%

Elizabeth Downs (S.A.):

12-month Property Growth: 23.50%

12-month Rental Growth: 16.70%

Orelia (W.A.):

12-month Property Growth: 25.70%

12-month Rental Growth: 14.90%

Berserker (QLD):

12-month Property Growth: 16.70%

12-month Rental Growth: 7.50%

Grab your copy today

https://www.hotspotting.com.au/product/national-top-10-positive-cashflow-hotspots/

The Federal Government’s latest Budget will go down in history as the “band-aid budget”.

Rather than fix fundamental problems and deal with core issues, the Federal Treasurer has thrown cash in various directions, in what looks very much like an election Budget.

They haven’t provided solutions to any of the core problems in the housing industry, particularly the rental shortage.

There are broken limbs everywhere in the industry - and in other parts of the national body - and the Federal Government has applied band-aids to a few of them.

It’s the same in other areas. Rather than pull the necessary levers to bring down power prices, as they promised repeatedly to do at the last election, they are throwing cash at everyone to help with their next power bills.

It’s another band-aid. It doesn’t reduce power prices which are a key component of inflation and a serious problem for many businesses. It’s simply a short-term, short-sighted, vote-buying measure that doesn’t address the core problem.

But, at Hotspotting, our key focus is on the very important issues in the housing market, particularly the rental shortage and the high costs of buying homes.

The Federal Budget repeated the previously announced ambition of building 1.2 million new homes over five years, but did not nothing to address the current rental shortage, nor to deal with housing affordability – something politicians often talk about, but continually make worse with their policies and decisions.

The Real Estate Buyers Agents Association of Australia (REBAA for short) summed it up when it commented:

“The Federal Budget featured plenty of promises to somehow improve housing supply over the long-term, but failed to recognise one of the most simple ways to remedy the rental crisis.”

They were referring to the reality that mum-and-dad investors provide over 90% of the homes that people rent in Australia and they need to be encouraged and incentivised to solve the dire shortage of rental properties – at a time when all the costs of owning real estate have risen.

REBAA President Melinda Jennison said the Federal Government had again refused to accept the fundamental role that property investors have long played in the provision of rental housing in this country. “Again, we have been presented with a variety of measures to supposedly boost housing supply at a time when building approvals and completions are at decade-lows,” Jennison said. “For decades, property investors have shouldered the burden of providing rental supply for successive governments. However, it's evident that this is no longer the situation. The rental crisis is the end result of this changing dynamic.

“The volume of investors currently active in the market is well below where it needs to be to significantly improve rental supply, but the Federal Government still won’t do anything to encourage more investors into the market.”

I agree with Jennison when she says that it's surprising that the budget has provided incentives to foreign investors to purchase established Build to Rent developments, but no incentives have been offered to the resident investors who provide homes for millions of renters throughout our country.

Aidan Collyer of Collyer Property Investments said the move for foreign investment tax breaks “will price young people who want to invest out of the market”.

“This is already an incredibly competitive market, Labor is allowing international investors to make a quick buck at the expense of the great Australian dream,” he said.

Elsewhere there have been plenty of critics of the Budget’s response to the nation’s housing crisis – or the lack of it.

The Daily Telegraph reported widespread criticism of the Budget’s failure to “shift the dial” on the housing shortage.

It said the Albanese government’s much-championed $6 billion pledge to address the housing crisis has fallen flat with the bulk of the money going towards infrastructure and not actual homes.

Almost $2 billion has been channelled into a rental assistance scheme, the same amount has been given to charities to build 40,000 social and affordable homes, while more than $1 billion to help states and territories with the construction of roads, sewers, energy and community infrastructure.

Despite the cost of building a new house rising more than 50% in the past three years, the Budget did not include assistance to help homebuyers with the cost of buying a property.

Everybody’s Home, a national campaign seeking to fix the crisis, said the budget failed to tackle rising housing costs.

It said: “The government’s ‘new’ funding for social housing is a repackaging of existing initiatives, offering loans instead of providing real funding, and the continuation of a funding agreement with the states and territories - something the Commonwealth routinely renews for other essential services like education and health.”

Everybody’s Home said the increase to Commonwealth Rent Assistance would provide some short-term relief, but was not a lasting fix.

And that is the failing of this Budget – it provides short-term relief on a number of issues, but does not provide any lasting solutions.

The West Australian newspaper commented that the increases to the Commonwealth Rental Assistance scheme contributes only a pittance to housing costs, with the weekly boost enough to buy only two cups of coffee.

The Budget offers a maximum of $12.50 per week to recipients of the assistance scheme, according to analysis by CoreLogic.

CoreLogic economist Eliza Owen echoed the comments of many others when she said the Budget missed an opportunity.

Yes, indeed, this band-aid Budget is a massive, missed opportunity. It could have provided real and lasting solutions to the rental shortage, to housing affordability and to many other core problems for Australian households – but it failed to do so.

Catch the replay of our latest webinar hosted by Tim Graham, General Manager of Hotspotting, featuring Tyron Hyde, the visionary founder of Washington Brown and a master of property depreciation.

Dive into the invaluable insights of "7 Lessons from the $26B Man," a presentation inspired by the legendary real estate mogul Harry Triguboff.

In this compelling session, you'll explore the powerful strategies that fuelled Harry Triguboff's ascent to billionaire status, with a focus on the transformative impact of compounding in real estate investment.

Discover practical advice and nuanced strategies that every property investor should consider:

The Power of Compounding: Learn how small, consistent investments can grow over time and how to leverage this in the property market for significant returns.

The 1% Rule: Uncover minor adjustments you can make that yield substantial improvements in investment outcomes. Whether it's negotiating a slightly better interest rate or enhancing property features to boost rental appeal, these small changes can dramatically increase your portfolio's value.

Annual Reviews: Understand the importance of reviewing your home loan rate annually to ensure you're getting the best possible deal. We'll also discuss the benefits of cross-checking comparable rental prices to maximize your income.

For more information on Washington Brown or to connect with Tyron Hyde, please visit www.washingtonbrown.com.au

You can also subscribe to Tyron's Ten with Ty podcast here: https://www.washingtonbrown.com.au/podcasts/

In this podcast episode, we dive into the two different approaches that state governments in Australia are taking to address the issue of rental shortage in the housing market. On one hand, Western Australia (WA) has adopted the carrot approach, offering incentives and encouragement to investors to increase the supply of rental properties. On the other hand, Victoria has decided to take the stick approach, punishing investors with new and higher taxes if they do not comply with the government's desires.

The WA government has implemented several measures to encourage investors to bring new supply to the rental market. This includes offering cash incentives to property owners who convert their short-term rental properties, such as Airbnb, into long-term rentals for permanent tenants. They have also relaxed regulations around building granny flats, providing interest-free loans to help builders complete unfinished properties, and offering cash incentives to owners of vacant homes to make them available for long-term rent.

In contrast, the Victorian government has scrapped the Victorian Home Buyer program, which was aimed at helping young people get into home ownership. They have instead turned to new and higher taxes on property investors to generate revenue and alleviate the state's debt. However, this approach may further exacerbate the rental shortage in Victoria.

It is clear that the WA government's approach is more constructive and will bring new supply to the market, while the Victorian approach may have negative consequences. The WA government has also allocated significant funding towards social and affordable housing initiatives to not only increase supply but also support those in need.

So, why are property investors now more likely to buy in Perth and key WA regional markets, while selling in Victoria? The difference lies in the government's actions – WA is encouraging investors, while Victoria is discouraging them. This highlights the importance of government policies and their impact on the housing market.

In conclusion, governments have two options when it comes to creating significant change – the carrot approach or the stick approach. In this case, the WA government's carrot approach seems to be more effective in addressing the rental shortage issue, while the Victorian government's stick approach may have negative consequences. Time will tell which approach will yield better results, but it is clear that incentives and encouragement go a long way in creating change.

🌟 Leading the Way in Property Management: Corinne Bohan from the award winning Image Property 🌟

Join us on the latest episode of the Hotspotting podcast, where we sit down with Corinne Bohan, the trailblazing Managing Director of Image Property—Australia’s #1 Property Management Company for four consecutive years according to the RateMyAgent Awards. Dive deep into the world of elite property management with insights from a leader managing over 5,000 properties.

🏡 What Sets Image Property Apart? Corinne shares the secrets behind Image Property's success, focusing on their process-driven approach that handles everything from proactive maintenance to strategic tenant selection. Discover how their emphasis on exceptional client service, combined with rigorous staff training programs, leads to exceptional customer experiences and high retention rates.

🚀 Insider Insights on Overcoming Industry Challenges From navigating low vacancy rates to maximising returns, Corinne discusses how Image Property's dedication to sustainable rental incomes and a detail-oriented management strategy has carved a unique niche in the market. Learn about their innovative solutions and the critical role of problem-solving and project management in their growth trajectory.

🌐 Expansion and Impact Hear about Image Property's recent expansion into new markets like the Gold Coast, and get a peek into the future with discussions on major commercial projects impacting the real estate landscape.

🔑 Why Listen? Whether you're a landlord looking to optimise your property investment or a property management professional aiming to elevate your operational strategies, this episode offers invaluable perspectives from one of the industry’s best.

You can watch the full episode on Youtube too, and make sure to follow Hotspotting for more expert takes on the real estate market's hottest topics! 🎙️

Watch on YouTube - https://youtu.be/ryYhJEBjx_4

To learn more about Image Property or to connect with Corinne Bohan please visit www.imageproperty.com.au

Australia has some outstanding markets which are performing on every metric, including price growth, rental growth, low vacancies and high yields.

And many of these places on not what you might expect.

Every quarter, Hotspotting publishes a report we call The Pulse, to identify 50 locations across Australia which deliver rental yields well above the average to investors.

The primary parameter of our national Top 50 list is to identify good markets with high rental yields, but our criteria also includes prospects for capital gains – and this report features locations which perform outstandingly well on price growth.

To provide an example of the possibilities, consider the regional town of Murray Bridge in South Australia.

In Murray Bridge, house rents have risen 27% in the past year, with the vacancy rate dropping further in the latest quarter to just 0.4% and the median rental yield growing from 5.4% to 5.5%. The median house price has grown 22% to $415,000 in the past year.

In Geraldton in WA, the median house price rose 11.6% to $355,000 in the past quarter, but the median rental yield remained well above average at 6.7%, following a 23% annual rise in house rents, with vacancies low at 0.8%.

This report also highlights some of the nation’s promising unit markets, in recognition of the rising trend of more and more buyers opting for apartments and townhouses – and attached dwellings now out-performing on price growth.

In Bowen Hills in inner-city Brisbane, the vacancy rate is 1.2% and the median unit rent has risen 15% in the past 12 months, with the median rental yield increasing from 6.2% to 6.6% in the past three months.

In that quarter, the median unit price has increased 7.1% from $425,000 to $455,000.

There are many other examples of this kind of outstanding performance on both rents and capital gains – all identified in the new quarterly edition of The Pulse.

If investors had followed our tips, three months ago, in a special report we call The Pulse, they could have achieved double-digit capital growth - in the latest quarter alone - and up to 30% in the past year.

The primary parameter of our national Top 50 list of locations in The Pulse is to identify good markets with high rental yields.

But our criteria also includes prospects for capital gains – and this report features locations which perform outstandingly well on price growth.

If you have an initial rental yield of 6% or 7% and your property’s value is growing 10% or 15% (or more) per year, you’re a happy investor.

Several of the locations on our Top 50 list have recorded capital growth above 10% in the latest quarter alone, headed by the Perth suburb of Orelia which increased 18% in three months.

All of the 50 locations on our Top 50 three months recorded capital growth over the latest quarter, except one – and most experienced median price growth above 5% in the quarter, including nine locations which rose more than 10% in three months.

In the case of Orelia, this means $70,000 in capital growth in just three months, while the Perth suburb of Hillman also rose $70,000.

If you had bought a house at the median price in East Mackay, Queensland, your property’s value would have risen $50,000 in three months.

A $490,000 purchase in the southern Brisbane suburb of Kingston three months ago would now be worth $535,000, up $45,000 in the latest quarter.

In annual growth terms, 11 of our suburbs have risen by more than 20% in the past year.

This report demonstrates that it is possible to achieve an investment property that ticks every box for the owner: high capital growth and above-average rental yields in affordable locations with ultra-low vacancies and rent rising more than 10% per year.

Among the most outstanding performers identified by this report are locations where property values have risen notably, but rental yields have increased because there has been an exceptional increase in rents.

One of the stand-out markets highlighted by this report is the Queensland town of Dalby, the key regional centre for the Western Downs region west of Brisbane.

With vacancies near zero, rents have risen 24% in the past 12 months, with the median rental yield increasing from 6.6% to 7.2% in the past three months. Property values have also soared, with the median house price up 15% to $350,000.

That is the kind of performance that is possible if you get the quarterly editions of the special report we call The Pulse.

The latest price data from two of the biggest sources of real estate information shows a resurgence in the regional areas, in competition with the capital cities.

The background to this is that the combined regions have outperformed on capital growth since Covid, with regional areas generally out-performing the big cities in the past four years.

But in the past 12 months, the tables have turned somewhat, with the cities overtaking the regions on growth in median prices, led by Adelaide, Brisbane and Perth.

Now, we’ve seen another twist, with the latest statistics from both PropTrack and CoreLogic indicating that the combined regions have had a resurgence since the start of 2024.

Let’s look at the PropTrack numbers first.

PropTrack figures indicate that the Combined Regions had 0.3% growth in the home price index in April, compared to 0.21% in the Capital Cities.

The highest growth for April was in Perth, followed by Adelaide, but with the regional areas of NSW, Queensland and WA also exceeding the national average growth figure.

In annual terms, the cities are ahead, up 7.2% compared to 5.1% in the regions.

Perth, Adelaide and Brisbane have all had exceptional growth, but the regional markets in Queensland, South Australia and Western Australia have all increased by more than 10% in the past 12 months.

The under-achievers in the past 12 months have been Melbourne, Hobart, Canberra and Darwin, as well as Regional Victoria and Regional Tasmania.

We really do have multi-speed markets, which is the norm in Australia at any point in time.

But since the Covid era started, the regions have been the overall stars, with home prices rising 55% in four years, compared to 36% by the capital cities.

In that four-year period, the biggest increase had been by Regional Queensland, up 68%, with Regional South Australia close behind with a 67% increase.

Next is Adelaide, followed by Brisbane and Perth.

Three other regional markets grew more than 50% in four years – NSW, WA and Tasmania.

CoreLogic has different numbers from PropTrack, which also is normal, but the market patterns are similar.

The CoreLogic figures show that in the past 12 months, the cities are ahead with house prices rising 10.3%, while the combined regions have risen 6.3%.

But more recently, the regions have excelled.

In April, house prices in the regions increased 0.8%, compared to 0.5% in the capital cities – with the regional markets in Queensland, South Australia and WA all rising more than 1%.

But the single biggest increase was Perth, up 2%, while Adelaide increased 1.2%.

In the latest quarter, the regions are up 2.1%, compared to 1.7% in the cities, with the regional markets of WA, South Australia and Queensland again leading the way – but again with Perth recording the biggest individual increase.

In the year to date, the first four months of 2024, the combined regions have grown 2.6% compared to 2.2% by the combined capital cities.

It’s a similar scenario with the unit markets.

In the year to date, the combined regions have growth 2.8% against 1.7% in the capital cities – and in the unit markets, the regions are also ahead in the past 12 months, up 7.2% compared to 6.7% in the cities.

In the cities, Brisbane, Adelaide and Perth have all excelled on unit price growth, but Melbourne, Hobart, Darwin and Canberra have been weak and dragged down the capital city average.

In the regions, Queensland is the leader and South Australia, WA and NSW have all performed solidly.

The overall message in the data is that affordability is the key factor.

Whichever way you look at the price data, the outstanding performers have not been expensive cities like Sydney, Melbourne and Canberra - but smaller cities like Adelaide, Perth and Brisbane, and the affordable regional markets.

The silliest people skulking around the edges of the property industry are the shallow attention-seekers who pump out nonsense reports claiming that no one can afford to buy property – not because it’s true or useful, but simply to drum up some free publicity for the business who is the source of the misinformation.

The shallowness and pointlessness of these reports is demonstrated by the results being seen in property markets, which emphatically contradict the notion that most people can’t buy homes because they’re unaffordable to the vast majority.

We are constantly inundated with reports claiming young Australians are priced out of the property market and doomed to a life-time of renting – but the latest official data shows there has been a 13% annual increase in the number of loans to first-home buyers.

The attention-seeking report writers claim no one can afford to buy, but first-timers are out there buying homes in rising numbers.

Beyond the apparently dire plight of young buyers, there are growing instances of reports saying most households are priced out of the market, not just the first-timers, and that our real estate is unaffordable to the vast majority of people.

And yet, in stark contrast to those claims, our markets are extremely busy with buyers in all price ranges - and prices continue to rise steadily.

Here’s the thing: if you want to achieve cheap and easy publicity for yourself or your business, the fast-track is to publish alleged research on housing affordability – and to guarantee maximum coverage, your so-called report needs to conclude that it’s a dire situation and hardly anyone can afford to buy homes.

Media loves that story line and will publish it every time, despite the fact that they ran the same or a similar story last week, and the week before, and the week before that.

Apparently journalists believe we all have an insatiable appetite for lies about housing affordability.

The sad reality is that it’s really easy to pump out a report with negative findings - because the report writer gets to decide their own definitions of affordable and unaffordable. It’s completely random and arbitrary – but the creators of these shallow documents pretending to be research can rest easy in the knowledge that no journalist will ever challenge them on their definitions and parameters, nor ever question their findings. They’ll go for the easy option of the cheap headline, every single time.

Recently one of the big four banks produced a particularly scurrilous and worthless press release, pretending to be serious research, which found that only 13% of homes in Australia are affordable for buyers.

Now, if that was true, property markets across the nation would be largely dormant. There would be few sales occurring and prices would be falling in most markets.

Of course, the opposite is happening. Current sales levels across Australia are 24% higher than the same time last year and prices are rising in most markets across Australia.

How can these two contradictory things be happening?

It’s because the report in question is shallow nonsense.

And we shouldn’t be surprised that a major bank would produce a dishonest document to generate publicity – we all know from the royal commission and from our own personal experiences that the big banks are very comfortable with being unethical in the pursuit of profits.

So we’re not surprised to see National Australia Bank producing a headline-grabbing report that was based on the principle that you should never let the facts get in the way of a cheap headline. When you’re a big four bank using the media, the truth is always optional – and indeed usually rather inconvenient.

So, here’s what the NAB report claimed – and, to their credit, they managed to keep a straight face while talking about it.

They said that just 13% of the homes that are for sale in Australia are affordable to the average household. Presumably that means that 87% of the homes for sale across the nation won’t sell because they’re beyond the financial reach of most of us.

How did they manage to come up with this implausible scenario, which is contradicted by what’s happening the market every single day?

By deciding, in the interests of a screaming headline, that if you have to spend more than 25% of household income on servicing the mortgage, then it’s unaffordable.

Who says that this is the definition of unaffordable? Well, the National Australia Bank, because if they’d used a realistic benchmark that’s in line with the reality of most households with mortgages, they would NOT have been able to claim that most homes are unaffordable and they wouldn’t have got any publicity.

If NAB was right, of course, and spending more than a quarter of the household income on the mortgage WAS unaffordable, then mortgage delinquency rates in Australia would be sky-high.

But they’re not. The mortgage delinquency rate in Australia, according to S&Ps, is just 1.4%. Yes, slightly more than 1% of people with mortgages are behind on their payments. Which means over 98% of home-owners are paying their mortgage on time, which means they’re finding it affordable, even though some might be finding it difficult.

But according to the NAB report, that cannot be true, because 87% of homes, and the loans needed to buy them, are unaffordable – according to them.

Sadly, this is just another case of economists demanding that property markets behave the way they think they should, rather than observing the way markets are actually behaving, and trying to understand why.

It’s remarkable how many politicians think that the solution to every problem that afflicts the housing market is to scrap negative gearing and make other changes to drum investors out of existence.

Want to fix the rental shortage? Scrap negative gearing.

Make housing more affordable? Scrap negative gearing.

Facilitate the construction of a million new homes in Australia? Scrap negative gearing.

The illogic of these attitudes – and the way they run counter to the truth – is quite remarkable.

And, while it’s become quite common for politicians and others to recommend the end to negative gearing tax benefits, none of those advocates have been able to explain how that measure would lift rental supply or improve housing affordability.

When asked for numbers, they don’t have any.

Those who hold to the view that massively punishing property investors will solve all the ills in the housing industry should ask themselves a few basic questions.

Why is it that Australia abolished negative gearing in the 1980s but within two years had reinstated it?

Why is that New Zealand, in similar fashion, banned negative gearing three years ago and is now in the process of bringing it back in?

And why is it Ireland, that ended negative gearing some years ago as well as increasing taxes on investors, now has a rental shortage catastrophe far worse than Australia has now?

History shows that every time a nation decides to scapegoat and punish property investors, rather than implement real solutions to housing problems, they end with a situation far worse than they started with.

NZ did it, partly based on the theory that deterring investors would put a lid on property prices and make homes more affordable. But NZ house prices soared, because it was home buyers pushing up prices, not investors.

Rents also rose sharply in NZ, because many investors dropped out of the market, causing a serious rental shortage.

So it’s alarming to see politicians seeking attention – and I have to say it’s usually minor parties like the Greens or independents who are grandstanding – constantly declaring that anti-investor policies will fix all the housing problems.

The latest “look at me” politician to do this is the loud and bogan independent Jacqui Lambie.

I’ve been observing Jacquie Lambie for a long time – let’s face it, she loves the limelight - and she has always struck me as someone who desperately needs counselling – constantly angry, always bombastically shouting about something or at someone - and desperately unable to articulate a coherent sentence, so it’s always difficult to understand why she’s so worked up.

So it really shouldn’t surprise me that she called a press conference recently to declare that if we wipe out negative gearing it’ll fix the rental shortage. But was unable to explain exactly how that would work. Because it wouldn’t work. It would achieve the opposite.

She also claims it would cause house prices to drop – which perpetuates the myth that somehow negatively-geared investors are the reason prices rise in Australia.

My estimate is that less than 20% of buyers in the market are negatively-geared investors. What we’re being asked to accept is that this small minority of buyers somehow overpowers the 80% plus of buyers who are home buyers or investors not claiming negative-gearing tax benefits, such as myself.

The largest and most powerful cohort in the market at any point in time, including right now, are home buyers other than first-home buyers. They are older, with higher incomes, they have equity in their existing homes, and they have considerable borrowing power – far more so than first-home buyers OR investors.

The politicians who are most vocal about squashing investors are the Greens, who would, if they had the chance, cap rents, scrap negative gearing, increase capital gains tax and impose other taxes on investors.

To get an impression of the impact that would have on the Australian rental market, if it ever happened, we can observe the situation in Ireland, which implemented very similar policies some years ago.

Today Ireland has a rental shortage catastrophe, far worse that the crisis in Australia.

Among the various reports and analysis I found on the Ireland market situation, were these comments:

“Ireland has been grappling with a severe housing crisis for over a decade, characterized by a shortage of affordable and suitable homes, rising housing costs and rents, and increasing homelessness. This crisis has had a profound impact on individuals, families, and the country's economy as a whole.”

And here’s another comment on the situation in that country:

“Ireland's rental market is a daunting place for households in 2024 and with demand far outweighing supply, finding somewhere to live has become increasingly difficult if not impossible. One of the biggest reasons why Ireland is facing a housing crisis is due to lower investment by developers and landlords.”

Well, if you’re going to impose policies that squash the people who supply the product that’s in short supply, what do you expect?!

In Australia, an open house for a vacant rental home will commonly attract 15 or 20 people wanting to rent it. In Ireland, the queue at a rental open house stretches out the door and down the street, literally for hundreds of metres.

Those are the consequences Australia faces if it ever implements the policies advocated by Jacqui Lambie – or the even more extreme ideas advocated by the Greens.

Let’s face it, this is nothing more than the politics of envy. Rantings from people with no vision or intelligence or expertise, just a nagging feeling that someone is better off than they are, so they need to be stopped.

And to hell with the consequences.

Tune in to the latest episode of the Hotspotting Podcast with your host Tim Graham who sits down with special guest Scott Parry, founder of Crown Money.

In this informative and eye-opening webinar, Scott shares his journey from starting out as a young mortgage broker to founding Crown Money, a company focused on helping people achieve their financial goals and becoming debt-free.

Crown Money clients on on average pay off their mortgages within 12 years, and Scott is calling a client every 23 days to congratulate them on being debt free!

The episode dives deep into the topic of mortgages and how it can either be a tool for achieving financial freedom or a trap that keeps people in debt. Scott discusses the common mistakes people make when taking out a mortgage and shares valuable tips on how to master your mortgage for a debt-free future.

With his years of experience and a passion for helping people achieve their financial goals, Scott shares valuable insights on how to pay off your home faster and become financially free.

Don't miss this insightful conversation that will change the way you think about mortgages and take a step towards achieving true financial freedom.

To catch the full webinar, you can watch it on YouTube here.

To learn more about Crown Money Management, please visit https://crownmoneymanagement.com.au/

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Book a meeting with Scott https://meetings.hubspot.com/scottparry/video-meeting?uuid=d3a46d42-93bd-461a-a9aa-c857222678cb

One of the fundamentals of understanding real estate dynamics is remembering that real estate markets are local in nature – and they are influenced by the local economy in which they sit, far more than by national factors.

Although economists and journalists often refer to “the Australian property market” and predict what will happen with “Australian property prices”, the reality is that there is no such entity as the Australian property market.

Take a look at the price growth results among the eight capital cities for last year and you will note that some had boom growth, some had moderate growth, some stagnated and a few had falling prices.

All those different scenarios occurred within just the eight cities. There were similar variations occurring throughout all the regional markets.

All those places sat within the same national economy, all had the same situation with interest rates and all were operating under the one Federal Government.

Why, then, did we have all those different outcomes? Because real estate markets are very LOCAL in nature. The greatest influence on them is the local economy.

For that reason, at Hotspotting we are always keenly interested in a quarterly report published by CommSec, called the State of the States report.

This report uses a series of different metrics to rank the eight state and territory economies.

And I have found, over many years, that there is a correlation between the strength of the state or territory economies and the performance of the capital city property markets.

The past two quarterly editions of the State of The States report have ranked South Australia as the No.1 ranked economy in the nation, a finding that would surprise many people.

In the latest edition, South Australia was ranked No.1 on four different indicators.

But it doesn’t surprise the team at Hotspotting because we are very aware that the economy of Adelaide and South Australia is pumping strongly, helped by its status as the high tech innovation capital of the nation and the leading state for alternative energy developments.

Coinciding with the rise and rise of the South Australian economy has been the rise and rise of the Adelaide property market.

In 2023, Adelaide was the No.1 or the No.2 market in Australia for house price growth (depending on whose statistics you believe), in competition with Perth.

PropTrack’s data showing the leading suburbs and towns in Australia for price growth in the four years since Covid arrived, finds that the top 5 suburbs in the nation for price growth performance were ALL affordable suburbs in affordable Adelaide.

In the latest edition of The State of the States, the No.2 ranked economy was Perth - and again, there’s a clear correlation between that reality and the performance of Perth as one of the leading boom property markets in the nation.

Melbourne and Victoria rank No.3 on economic performance and this is one of several reasons why we believe that this market is poised for price growth in 2024, coupled also with very strong population data and a recent uplift in sales activity.

Consistently at the bottom of the CommSec report rankings is the Northern Territory, with its biggest weakness in the latest quarterly edition being housing finance – and it does not surprise us that Darwin has the weakest house price performance of all the capital cities in the past 12 months.

Other economies with lukewarm economic performance are Tasmania and the ACT – and this corresponds with the poor price performance of the Hobart and Canberra housing markets in the past year.

So this report, freely able to anyone who is interested, is one that’s worth following – because, read in conjunction with other data, it can provide clues about where prices are likely to rise in the near future.

Are you ready to take your investment journey to the next level?

Look no further, because we have exciting news to share with you! We are thrilled to announce our new Hotspotting pre-recorded interviews with some of the top 1% of Australian investors who own 5 or more properties.

As you may know, in the 2020-2021 financial year, only 0.87% of investors in Australia owned 5 or more investment properties. But what do these successful investors know that the majority don't? We have sat down with a number of them to get exclusive insights into their strategies, tips, and personal journeys.

Our pre-recorded interviews bring you valuable knowledge and advice from Australian property experts who walk the walk and practice what they preach. Learn from their mistakes, successes, and unique perspectives on property investment. These interviews are a must-watch for anyone looking to build a successful investment portfolio and achieve financial freedom.

With over 71% of investors owning only one investment property, we understand the challenges and uncertainties that come with growing your portfolio. That's why we have curated a series of interviews that exclusively feature investors with multiple properties. They represent the top 1% of Australian investors and have achieved remarkable success in their investment journey.

Our pre-recorded interviews are available for you to watch at your convenience, so you can take in all the knowledge and insights at your own pace. Hear firsthand how they navigate the ever-changing property market and make profitable investment decisions. You'll be able to walk away with practical tips and strategies that you can implement in your own investment journey.

About Kate Hill

Kate is an avid property investor with many years of firsthand experience buying and researching real estate. She founded Adviseable after many years as a Property Coach and Mentor. An accomplished Property Investment Adviser, Kate has facilitated hundreds of successful property investment purchases and has been named among the top 2 Your Investment Property magazine’s Advisers of the Year in Australia. She has also featured prolifically in the national media, commenting on TV, the press, radio and podcasts.

Kate is the co-author of the book The Female Investor: Building Wealth Security and Freedom Through Property Kate’s success as an adviser can be attributed to her keen sense of matching property with buyers, her knack for identifying outstanding property investment opportunities, and her tenacious negotiation skills. It’s these qualities that enable our clients to feel comfortable throughout the purchase process knowing that she’s in their corner.

Kate has a significant and growing property investment portfolio herself, and her personal philosophy is simple; “focus on results, and always buy property with maximum growth potential”. When she’s not immersed in research material in an effort to uncover the latest property investment hot-spots, Kate enjoys competing in ocean swim events, long-distance running, cinema or relaxing with a good book.

www.adviseable.com.au

Join us on this enlightening episode of the Hotspotting podcast, where host Tim Graham welcomes Sallyanne Hartnell from Reflect Coaching. An award-nominated Relationship and Divorce Coach and podcast host of "Reflect, Reclaim & Liberate," Sallyanne is on a mission to transform the divorce experience, helping couples reorganise their lives and family dynamics post-separation with dignity and less drama.

In this episode, Sallyanne sheds light on why she might be the professional "no one wants, but many need." We explore the intriguing intersection of divorce and real estate, discussing how the division of significant assets like property can be navigated smoothly during these challenging times. Sallyanne shares her insights on the trends in divorce rates, including a spike observed during the COVID-19 pandemic, and offers expert advice on managing property settlements distinctively from the divorce proceedings.

Moreover, Sallyanne provides invaluable guidance on co-parenting and maintaining healthy family relationships post-divorce. Whether you're facing the possibility of a separation or seeking to understand the complexities surrounding divorce and asset division, this episode offers crucial perspectives that touch both the heart and the pocket.

Tune in to gain a deeper understanding of how to approach one of life's most difficult transitions with clarity and confidence, ensuring you protect both your emotional well-being and financial security.

If you would like to connect with Sallyanne, you can reach her at www.reflectcoaching.com.au

There are numerous reasons why we think Melbourne and Victoria is worthy of consideration by property investors, notwithstanding the concerted efforts by the state government and some local councils to force investors to sell up and get as far away from Victoria as possible.

Melbourne and Victoria are underpinned by one of the nation’s strongest state economies, according to CommSec’s State of the States report, and there has been a notable uplift in sales activity since the start of 2024, pointing to elevated price growth as the year unfolds.

But perhaps the most compelling evidence, pointing to growing strength in the Melbourne market in particular, is the latest population data from the Australian Bureau of Statistics.

The ABS figures describing population growth in 2023 are largely dominated by Melbourne.

While the annual growth rate for Australia was 2.4%, Melbourne rose 3.3% - which was the highest in the nation except for Perth.

The National Top 10 list for the fastest growing local government areas in Australia – that’s the percentage growth rate for the year - included three Melbourne LGAs, with the City of Melbourne the No.1 fastest growing municipality in the nation.

The Nearby City of Yarra and the City of Melton in the western suburbs also made the top 10 national list.

In terms of LGAs with the largest growth, the actual number of new people added to the population, four of the national Top 10 were in Melbourne – the City of Melbourne and three outer-ring growth areas, the municipalities of Wyndham, Casey and Melton.

At a suburb level, most of Australia’s fastest growing suburbs are in the Greater Melbourne area.

That includes the nation’s fastest growing suburb, Rockbank in the western suburbs of Melbourne.

Of the top 12 fastest growing suburbs in Australia, 9 are in Greater Melbourne.

And of the nation’s top 30 fastest growing suburbs, 16 are in Greater Melbourne.

Now, to be clear, we’re not suggesting that population growth is the over-riding factor in choosing where to buy real estate. It’s one of many factors to take into account.

But, considered alongside all the other factors, it’s a pretty strong endorsement of Melbourne’s prospects – it’s a tale of growth and the remarkable thing is, Melbourne hasn’t delivered any major price growth recently.

That, I believe, will emerge later in 2024 and beyond.

Media loves the storyline that first-home buyers are competing with wealthy investors for properties – and losing because investors apparently have a huge advantage.

Like so much that’s written and spoken in news media about the housing market, it’s a work of fiction. The polar opposite is, in fact, the truth.

The biggest competition for first-home buyers in the market is not investors, but home buyers other than first-time buyers.

The largest cohort in the market, at any point in time, is home buyers who already own a home, have equity in that home and are upgrading – or, in some cases, down-sizing.

These are buyers who are older, with equity, higher incomes and borrowing power – and they can easily over-power a young novice in the market.

The biggest problem for first-home buyers is not investors, it’s the incredibly high costs of getting into the market because of the policies, decisions and actions by politicians and bureaucrats.

Just take a look at the cost of a house-and-land package anywhere in Australia. Given that the cost of constructing the average brick-and-tile house is now close to half a million dollars, not including the land cost, it’s hard to find a new home in a housing estate for under $700,000. It’s considerably more in the biggest cities.

The greatest lie of all is that investors have a big advantage over first-home buyers in the market. Presumably media says that because of their persistent misunderstanding about negative gearing.

The reality is quite the opposite. If it comes down to a competition between a first-home buyer and an investor, the first-home buyer has several big factors in their favour.

First-home buyers have high levels of government assistance, whereas investors do not. Quite the opposite, investors increasingly face major impediments from government.

First-home buyers are granted stamp duty concessions, so they have to pay little or nothing compared to the massive tax imposed on investor buyers.

Investors are slugged with much higher interest rates by lenders, so that if you have a first-home buyer and an investor of similar ages and incomes, the first-home buyer has considerably greater borrowing power and therefore has a competitive advantage over the investor who earns the same income.

Keep in mind that, according to the latest research data, most investors are young, on average incomes and need to buy as affordably as possible, which means they cannot pay high prices for properties in competition with other buyers.

Investors have several other disadvantages compared to home buyers.

As well as paying higher interest rates, they pay higher council rates and they pay higher rates of insurance. And they have to pay taxes that home buyers do NOT have to pay, including land tax and capital gains tax.

The only potential positive on the investor side of the equation is negative gearing, which in some cases, but certainly NOT ALL, may reduce the amount of tax the investor pays – but that does nothing to increase the investor’s borrowing capacity or ability to pay a high price for a property.

The whole narrative around first-home buyers being priced out of the market by so-called wealthy investors is a lie.

And indeed, the latest official data on lending to buy property shows that there has been a 13% increase in first-home buyer activity this year, compared to the same time last year.

If you want to sell real estate, very often the greatest selling point is the location.

If the location has …

a strong diverse economy creating jobs,
a steadily growing population with strong increases projected well into the future,
good existing amenities and a significant spend on new infrastructure

… then it has many of the credentials for capital growth.

The problem for many real estate professionals - in taking advantage of growth factors like that in their location- is accessing all the key information, analysing it and then presenting it in a way that’s easily accessible to potential customers.

Many people in the industry just don’t have the time or the resources to do all that.

That’s where Hotspotting’s unique custom reports service comes in. It saves you time and it projects your business as professional, informed and successful.

The Hotspotting team can create location reports on individual suburbs, clusters of suburbs, local government areas, towns and regional cities, and on major capital cities.

The reports are provided with the client’s branding and location details, as well as (if you choose) the Hotspotting brand to provide the assurance and credibility of an independent third-party research source.

This is a custom report service you cannot get anywhere else.

Our customers love it. One of them says ...

“Hotspotting was a pleasure to deal with when arranging my Custom Report. As a buyer’s agent for many years, I was astounded by how much effort and research goes into their reports. Their communication was great and I am extremely happy with the final result.”

And another of our regular customers commented …

"The research provided by hotspotting.com.au has been an integral part of our success and the growth of our business. The ability to access independent research reports on the locations we believe are best for our clients, with our branding, has made it easier to show our customers the merits of the places we think have the strongest growth credentials."

We love to get feedback like that, because we regard our custom reports as one of our most important product services.If you would to find out more our Hotspotting’s exclusive custom reports service, contact me on ryder@hotspotting.com.au or go to the hotspotting.com.au website and select “products” on the menu at the top and then “custom reports”.

Want to get into a key market BEFORE prices start to take off?

Feel that you may have missed the boat with media favourite Perth? In many ways, the answers to these questions are the essence of smart investing.

Most property investors are herd animals, diving into markets when they read that prices have risen 15% or 20% in the past year – or 50% in the past three years.

Buying in such a market means you are likely buying at – or after – the peak of the market. The smart money would have been there 2-3 years ago – and is now focused on places that are early in the growth cycle. That’s why Melbourne makes more sense than Perth for property investors seeking to buy strategically for capital growth.

The Melbourne market, in simple terms, is situated where Perth was three years ago, before prices started to rise and rise. The Melbourne market is underpinned by one of the nation’s strongest state economies and boosted by population growth amongst the highest in the country. It hasn’t had the price growth of other cities in the past year but has had a big uplift in buyer activity recently – often a precursor to elevated prices. And vacancies are ultra-low, putting upward pressure on rents.

To find out more about why Melbourne and Regional Victoria should be strongly considered by property investors, join leading national buyers’ agent Kate Hill of Adviseable in this webinar recording hosted by Hotspotting founder Terry Ryder.

In this webinar, you will learn ….

**Why now is a good time to consider Melbourne and Regional Victoria

**Which metrics point to capital growth in Victorian markets

**Why recent rental reforms should not deter investors

**Which price points are attracting the greatest buyer demand

*Why attached dwellings need to be considered

*Which Melbourne suburbs and regional centres deserve the most attention

To connect with Kate Hill, you can reach here at kate@adviseable.com.au or www.adviseable.com.au

Are you ready to take your investment journey to the next level?

Look no further, because we have exciting news to share with you!

We are thrilled to announce our new Hotspotting pre-recorded interviews with some of the top 1% of Australian investors who own 5 or more properties.

As you may know, in the 2020-2021 financial year, only 0.87% of investors in Australia owned 5 or more investment properties. But what do these successful investors know that the majority don't?

We have sat down with a number of them to get exclusive insights into their strategies, tips, and personal journeys. Our pre-recorded interviews bring you valuable knowledge and advice from Australian property experts who walk the walk and practice what they preach. Learn from their mistakes, successes, and unique perspectives on property investment.

These interviews are a must-watch for anyone looking to build a successful investment portfolio and achieve financial freedom. With over 71% of investors owning only one investment property, we understand the challenges and uncertainties that come with growing your portfolio. That's why we have curated a series of interviews that exclusively feature investors with multiple properties. They represent the top 1% of Australian investors and have achieved remarkable success in their investment journey.

Our pre-recorded interviews are available for you to watch at your convenience, so you can take in all the knowledge and insights at your own pace. Hear firsthand how they navigate the ever-changing property market and make profitable investment decisions. You'll be able to walk away with practical tips and strategies that you can implement in your own investment journey.

About Arjun Paliwal

Having begun the 2010s with lofty ambitions of becoming the top dog at the Commonwealth Bank of Australia, a decision to maximise his “worst case” has led Arjun Paliwal to the man he is today.

Almost six years ago, Mr Paliwal decided to pour all his eggs into the InvestorKit basket – and he hasn’t looked back since.

Recently, InvestorKit was named the Buyer’s Agency of the Year for the second year in a row at the REB Awards, a proud moment for the business and a ratification that their modus operandi to become “the most trusted data-driven buyer’s agency for successful business owners and professionals looking to scale their business” is coming to fruition.

www.investorkit.com.au

Part of the obsession by economists with interest rates as the only thing that matters in the housing market is the notion that the Reserve Bank spends a large amount of time discussing the housing market before deciding what to do about interest rates.

As with so many things, economists are wrong about that.

One of the most popular definitions of insanity is doing the same thing over and over again, but expecting a different result.

My own definition of insanity is the average Australian economist discussing real estate.

In essence, those two definitions are essentially the same thing.

Economists, especially those working for the big four banks, tend to believe that everything that happens in residential real estate is dictated by trends with interest rates.

In their simplistic view of things, rising interest rates means falling prices and falling interest rates means a property boom.

They’re utterly wrong about that, because there are always forces more powerful than interest rate movements dictating what happens in real estate – including, right now, the serious imbalance between supply and demand.

The other thing economists and other commentators get wrong is their belief that the property market is the over-riding influence in RBA decisions about interest rates.

In reality, the property market has little or no impact on RBA decisions. There have been repeated RBA statements over the years telling us that the board does not consider its role to include control or influence the property market.

We have seen it in their decision making in the past couple of years, when the prime consideration was trying to bring down the rate of inflation.

So now we have a string of mistaken assumptions from economists leading to the forecast that real estate will struggle late this year because the expected cut in interest rates won’t happen.

The first mistaken assumption is that the board will decide NOT to cut interest rates later this year because property prices are rising. As I said, they have made it clear they’re fundamentally not the regulators of the real estate market.

The second mistaken assumption is that cutting interest rates would cause a property boom - or that keeping interest rates at their current levels will suppress the market.

Economists are clearly not students of history.

In the late 1980s we had interest rates rising and rising to levels far higher than today and ultimately as high as 17%, if you can believe that – and despite those obscenely high and rising interest rates, property prices kept rising and rising.

It was one of the most spectacular property booms in the nation’s history.

In the early years of this century, we had several years of interest rates high and rising, and property prices kept on increasing.

And then again last year, 2023 had repeated increases in interest rates and – notwithstanding the doomsday forecasts of economists – house prices rose strongly in most locations, including well above 10% in a number of our capital cities.

Meanwhile, the years before Covid had extremely low interest rates but property prices were falling and in 2020, the year of the lockdowns, interest rates went to record lows but there was no property boom (although prices did show moderate growth).

When markets boomed in 2021, it was driven by a host of factors, including a high level of government incentives and spending to generate economic recovery.

So, in summary – whether or not the Reserve Bank decides to cut interest rates later in the year will depend on their view of inflation and the state of the national economy. Events in the real estate markets will NOT dominate the conversation.

If they do decide to cut interest rates, it will NOT generate a property boom.

The big factor will continue to be the shortage of dwellings, regardless of any decisions about interest rates.

If you tune into news media regularly, it’s easy to form the view that the prospect of young Australians buying real estate is remote, if not impossible.

There are daily headlines telling us that it takes 10 or 15 years to save a deposit, or that most young Australians have given up on home ownership and that young adults are doomed to a life-time of renting.

As is so often the case with mainstream media and their love of negative sensation, the reality is quite different. First home buyers are highly active in markets across Australia.

But first, let’s look at some of headlines with which we are afflicted every day in Australian news media:

“Housing crisis escalates as affordability worsens”.

“It’s insane how much you need to save to buy in Queensland”

“Melbourne home seekers need to save $250,000-plus to buy a home”

“Cost of living crisis holding back first home buyers”

And the most spectacular of them all …

“The Australian Dream crashes into the affordability brick wall”.

One article in the Fairfax media declared: “Aussie home seekers are being made to come up with hundreds of thousands of dollars in upfront funds to buy a home.”

How did they come up with such a finding?

By focusing on a 20% deposit (which you don’t need), the median house price (which is ridiculous because FHBs don’t buy at the median price) and always houses, never units which are the dwelling of choice for more and more people and are often half the price of houses in the same suburb.

In other words, the objective of those media outlets was not to be informative or helpful – it was simply to create a screaming headline (and the truth is optional).

And that article with the headline “The Australian Dream crashes into the affordability brick wall” ?

The intro to the article immediately contradicted the headline. It said:

Westpac’s Home Ownership Report shows an increase in the share of Australians aspiring to own a home.

The survey found 44% of Australians plan to buy a new home in the next five years, up 9 percentage points since July 2023.

So what’s really happening out there in first-home buyer land?

The latest data from the Australian Bureau of Statistics shows that, far from being priced out of the market, buying activity by first-home buyers has increased recently.

The figures on loans to buy a home show that the number of loans to FHBs rose 4.3% in February, compared to January, and were up 13.2% compared to a year earlier.

The figures showed that the number of FHBs buying homes was broadly in line with pre-pandemic levels.

National Australia Bank senior markets economist Taylor Nugent said first-home buyers were proving resilient.

He said higher mortgage rates were not proving much of a hurdle for first-time buyers.

In addition to that, research by the Commonwealth Bank finds young Australians are also a dominant force among those buying investment properties.

It found that the most active age group among those buying investment properties is the cohort aged between 27 and 42, the one know as Millennials. That group accounted for almost half of investor property purchases in 2023.

CBA said investors are getting younger, overall, because of the growing incidence of people getting into the property markets as rentvestors – i.e. people who choose to rent their homes and buy an investment property.

So, is home ownership a fading dream for young Australians?

According to the data, rather than the media rhetoric, the answer is emphatically NO.

The dream is very much alive.

Want to know why housing affordability is so poor in this country?

The answer, in simple terms, is because the cost of building new houses is so high – ridiculously, obscenely high.

The cost of building the typical house in Australia has risen 53% in the past three years – and it now costs close to half a million dollars to build that home.

And that’s just the cost of the house. It doesn’t include the price of the land.

Who’s to blame for this situation?

Primarily, overwhelmingly, it’s government. Politicians and bureaucrats.

They keep making decisions that add to the cost of creating new homes.

Just three years ago, the average cost of building a new house was $320,000.

Now, early in 2024, its $490,000.

Government meddling with the housing industry, and their obsession with using the housing industry as their go-to cash cow when they need to raise money, has caused the average cost of a new house to blow out to almost $500,000.

It’s not the usual suspects that journalists and economists and politicians like to blame for poor housing affordability.

This has got nothing to do with negative gearing, or foreign investors, or mum-and-dad Australian investors, or government grants to first-home buyers pushing up prices.

It’s purely and simply the constant addition to the cost of creating new homes by politicians and bureaucrats.

A couple of years ago, a research study revealed that between 35% and 50% of the cost of a new house-and-land package – depending on where you are in Australia – was taxes, fees and charges by the three levels of government.

Imagine that reality. That every time someone builds a new home in Sydney, half of the cost they’re paying is taxes and fees to government.

Stamp duty, land tax, GST, capital gains tax, application fees, infrastructure charges – and many, many more.

And then there’s the cost of red tape – delays and additional costs caused by bureaucrats.

But that’s just the background. Every year the cost of building a new house grows larger because governments keep changing the rules and regulations – always in ways that add to the costs of construction.

New regulations to make houses safer. New rules to make houses more accessible. New laws to make houses more environmentally friendly. New guidelines to make houses more aesthetically appealing.

Now you might think that those measures are all good things. If houses are (allegedly) safer, more accessible, new energy efficient and better looking, that’s all very positive.

But if you feel that way, you cannot then complain about poor affordability, because you’ve just declared your support for measures that have added massively to the cost of creating new homes for young Australians – thereby causing a further deterioration in housing affordability.

The problem of government taxes, legislation and red tape pushing up the cost of housing has been exacerbated in recent times by the shortages of tradespeople and materials.

Why are there shortages of tradespeople? Mostly it’s because governments around Australia have been trying to spend their way out of the problems of the Covid era with major, new, headline-grabbing infrastructure, which is pulling skilled people out of the home-building industry.

The infrastructure projects that are scheduled to happen in the next five years total $230 billion – at current cost estimates and we can be sure they will blow out to a lot more – and that means the workforce needs to grow 127% to provide the workers and tradesperson required to build all that.

And this will make matters worse for the home building industry.

Master Builders Australia says that the main reasons the cost of building houses has increased so much are ...

Increased building approval times
High taxes, particularly land tax
The shortage of workers
The high cost of materials

Most of the blame for that sits at the feet of government – politicians and bureaucrats.

We’re constantly asked at Hotspotting whether it’s better to invest in the regions or the capital cities – and whether you get higher capital growth in the outer-ring suburbs of our cities or the so-called prime inner-city locations.

Now, there’s no definitive answer to questions like that, because there are so many different scenarios to consider – and, at the end of the day, it comes down to the performance of individual local markets and you simply cannot generalise.

But, based on the evidence of where the highest capital growth has occurred in the past four years, I would have to say the best performers have been found in regional areas and the outer-ring precincts of capital cities – NOT including Sydney or Melbourne.

PropTrack, which is Hotspotting’s preferred source of property data, has analysed capital growth since March 2020 – which is when the Covid lockdowns started to happen.It shows that home prices have increased 40% in the four years since.

But the growth in the combined regional areas has been 54%, compared with 35% in the combined capital cities.

So there’s your first answer: based on this evidence, the regions have out-performed the cities overall.

When you divide Australia into the 15 major jurisdictions (eight capital cities and seven state or territory regional areas), the top two areas are regional and six of the top nine are regional precincts.

Regional Queensland ranks No.1, with home values up 66.5%, followed by Regional South Australia, up 66.2%.

The next on the list are Adelaide in third place, Brisbane fourth and Perth fifth.

Then, in order, come Regional WA, Regional Tasmania, Regional NSW, Regional Victoria and, in 10th place, the ACT.

You’ll note that those are the top 10 on the list of 15 jurisdictions, and Sydney and Melbourne haven’t featured yet.

Sydney ranks 12th out of the 15 and Melbourne ranks 14th – or second last.

So there’s a fairly emphatic answer: the regions have undoubtedly out-performed the cities – and the best performers among the cities don’t include the two biggest ones.

Adelaide home prices increased 64% and Brisbane 63%, to be the strongest capital cities on capital growth over four years, compared with 35% in Sydney and just 17% in Melbourne.

When PropTrack looked at the individual locations within the regions and the cities, the Top 10 list of locations for capital growth in the past four years comprised regional centres and the outer ring areas of capital cities.

The Wide Bay region of Queensland was the top individual area on price performance, with values up 80% in four years.

This notable growth region includes regional centres like Hervey Bay, Bundaberg, Gympie and Kingaroy – all places which have featured in recent years in our Hotspots reports.

Next was Ipswich City, in the outer south-west of Greater Brisbane, followed by the Outer North of Greater Adelaide – both up by more than 75%.

At Hotspotting, we have strongly advocated Ipswich and northern Adelaide LGAs like Salisbury, Playford and Gawler in the past several years.

Fourth on the list was the Gold Coast, which rose 74% in the four years.

It’s notable that 9 of the 10 locations on the national top 10 list are in Queensland and South Australia.

And here’s a final thought.

What I’ve just described is what’s happened in the past four years.

Thre’s no guarantee the same will happen in the next four years.

As we often tell people, the past does NOT inform the future.

But it’s worth noting that, based on the metrics we use at Hotspotting, we do expect Brisbane, Regional Queensland and Adelaide to be among the best performers on price in the next year or so.

The smart money in real estate buys in key markets BEFORE prices start to take off.

The essence of smart investing is NOT buying in over-heated markets like Perth but targeting locations that have the credentials for long-term growth but are currently at a low point in the cycle.

And right now, the location that meets those criteria better than most is Victoria, particularly Melbourne.

Most property investors are herd animals, diving into markets when they read that prices have risen 15% or 20% in the past year – or 50% in the past three years.

Buying in such a market means you are likely buying at – or after – the peak of the market.

The smart money would have been there 2-3 years ago – and is now focused on places that are early in the growth cycle.

That’s why Melbourne makes more sense than Perth for property investors seeking to buy strategically for capital growth.

The Melbourne market, in simple terms, is situated where Perth was three years ago, before prices started to rise and rise.

The Melbourne market is underpinned by one of the nation’s strongest state economies and boosted by population growth amongst the highest in the country, enhanced by overseas migrants and students.

It hasn’t had the price growth of other cities in the past year but has had a big uplift in buyer activity recently – often a precursor to elevated prices.

And vacancies are ultra low, putting further upward pressure on rents.

To find out more about why Melbourne and Regional Victoria should be strongly considered by property investors, there are two keys actions you can take …

Tune into my April 17 webinar featuring leading national buyers’ agent Kate Hill of Adviseable – and get our Victoria Hotspots bundle, featuring our reports on Melbourne and on Regional Victoria.

These two great sources of key information will explain ….

Why now is a good time to consider Melbourne and Regional Victoria
Which metrics point to capital growth in Victorian markets
Why recent rental reforms should not deter investors
Which price points are attracting the greatest buyer demand
Why attached dwellings need to be considered
Which Melbourne suburbs and regional centres deserve the most attention

Are you ready to take your investment journey to the next level?

Look no further, because we have exciting news to share with you!

We are thrilled to announce our new Hotspotting pre-recorded interviews with some of the top 1% of Australian investors who own 5 or more properties.

As you may know, in the 2020-2021 financial year, only 0.87% of investors in Australia owned 5 or more investment properties. But what do these successful investors know that the majority don't? We have sat down with a number of them to get exclusive insights into their strategies, tips, and personal journeys.

Our pre-recorded interviews bring you valuable knowledge and advice from Australian property experts who walk the walk and practice what they preach. Learn from their mistakes, successes, and unique perspectives on property investment. These interviews are a must-watch for anyone looking to build a successful investment portfolio and achieve financial freedom.

With over 71% of investors owning only one investment property, we understand the challenges and uncertainties that come with growing your portfolio. That's why we have curated a series of interviews that exclusively feature investors with multiple properties. They represent the top 1% of Australian investors and have achieved remarkable success in their investment journey.

Our pre-recorded interviews are available for you to watch at your convenience, so you can take in all the knowledge and insights at your own pace. Hear firsthand how they navigate the ever-changing property market and make profitable investment decisions. You'll be able to walk away with practical tips and strategies that you can implement in your own investment journey.

About Matt Wilson

Matt is the founder of WT Capital & the chief storyteller. He started his career not in property but in the 3 Michelin starred kitchens of Paris, after returning to Sydney he brought an unseen level of service to the emerging buyers advocacy space.

WT Capital was founded with one goal in mind, to deliver the highest quality service throughout each property transaction.

www.wtcapital.com.au

Many Australians grow their wealth through passive investment in real estate: buy a property, install a tenant and wait for growth.

There’s a better, and faster, way – without high risk.

More and more investors are using development strategies to accelerate the wealth-creation process, with small subdivisions one of the most accessible and successful.

Wealth mentor Brad Cassidy of The Kaizen Way teaches these strategies to investors across Australia, with notable results.

Recently, our Hotspotting founder Terry Ryder hosted Brad on a webinar to discuss how to profit from small subdivisions.

The webinar demonstrates how to …

** undertake a subdivision as a “hands-off” investment

** find the right team of specialists to facilitate the process

** avoid common mistakes and pitfalls

** identify the costs involved, including council fees and charges

** understand the procedures with case studies of successful projects

** find opportunities for this type of investment, using an exclusive tool developed by Brad and his team

If you would like to find out more about how Brad can help you, please follow the link below and add your details so that you can take advantage of a huge bonus woth $3,995 for the first 5 people.

Plus a special price on his membership offering. https://propertymasterythekaizenway.com/terry-special

You can watch the replay of this webinar on youtube here: https://youtu.be/t5WdKo-75l4

At Hotspotting we’re always on the alert for evidence of CHANGE that will influence property markets.

The great potential in residential real estate is that change is always happening, opening up new possibilities for growth.

One of our catch-cries at Hotspotting is that THE PAST DOES NOT INFORM THE FUTURE.

Poor performers of the recent past can become the nation’s leaders of the near future.

One of the biggest trends we are tracking, under the general theme of change, is the rise and rise of apartments – challenging the dominant paradigm of real estate.

That paradigm, still widely accepted in the real estate industry, states that houses always outperform units and townhouses on capital growth.

But that is undoubtedly changing.

We are seeing growing evidence that more and more buyers of various sorts are opting for attached dwellings – be they units, townhouses or apartments.

Buyer demand in locations where units dominant the dwelling mix - or are a significant part of the dwelling mix - has been rising notably for the past 12 months.

Suburbs where units dominate the dwelling mix are now among the most powerful markets in Australia – which makes our Top 10 Apartment Hotspots report essential reading for investors seeking opportunities in 2024.

Those seeking out well-located and affordable apartments include older people downsizing from a large family home.

They also include …

young people seeking an affordable first step on the property ladder;
lifestyle buyers seeking low-maintenance, lock-up-and-leave options in good locations;
overseas migrants from countries where unit-style living is the norm; and
investors seeking affordability and higher rental yields in good locations.

In inner-city precincts in our biggest cities, houses can typically cost over $2 million, but apartments can be bought in the $600,000s and $700,000s in the same suburbs in many cases.

The rental yields are also significantly higher, a key consideration in times of higher interest rates – although it needs to be remembered that apartments do entail additional costs like body corporate fees.

But the most noteworthy data relates to capital growth. In a growing number of locations throughout Australia, apartments have recorded larger increases in median prices than houses, both in the past year and over the longer term.

At Southport on the Gold Coast, apartments are considerably cheaper than houses, sell faster, have higher rental yields, have recorded bigger price growth in the past year – and the long-term capital growth rate is close to 10% per year.

There are many, many more examples like this across Australia.

So there is a significant list of good reasons why apartments are attracting growing demand from a range of buyers.

And that means that the dominant paradigm of real estate is looking decidedly shakey.

I’ve been in and around news media my whole adult life and I STILL haven’t got used to the way journalists these days can look at a set of numbers that are overwhelmingly positive but find the only negative – and make that their headline.

Somehow, journalists have formed the view that we’re endlessly attracted to screaming negatives and don’t want to hear about anything UPLIFTING that’s happening in the world.

Recently, one of the major real estate data firms published data on the property ownership rates for women and men in Australia.

This was topical because there’s a lot of focus on ways that females are financially disadvantaged, including with the level of super the average woman has at retirement, compared to men.

So the findings of this analysis by CoreLogic was a strong and positive story, because overall it showed that women are more likely to own real estate than men – only slightly, but that finding would have surprised a lot of people.

In some age groups, such as Millennials and Gen X, women were significantly ahead of men on property ownership and with the oldest grouping, Baby Boomers, it was fairly even.

Only with Gen Z, those aged under 30, were males more likely to own property than women.

So, overall, a pretty positive story, right?

Well, no, many reporters managed to turn this into a negative, by focusing their coverage on the only age group that was less successful for women, the Gen Z cohort.

Sadly, typical.

In another recent story, the Pain and Gain report from CoreLogic showed that, in most market jurisdictions across Australia, the vast majority of sales in the past 12 months had been profitable for the vendor.

In Brisbane, every suburb had recorded growth for vendors, both for house sales and unit sales – a 100% success story right across the city.

It was similar in Adelaide, Perth and Sydney – close to 100% of suburbs had delivered house price growth and unit price growth for vendors in the past year.

But a lot of the media coverage found a negative for their headline. In Melbourne, 82% of suburbs recorded annual growth in unit prices – but the media coverage focussed on the 18% that didn’t.

“Nearly one in five suburbs recorded price falls,” shouted one headline.

There are myriad examples of media’s desire to focus on – or create – sensational negatives, with little or no attention to the potential positives.

Every day, across Australia, there are articles describing the rental shortage – which doesn’t fit the definition of “news” because everyone KNOWS there’s an under-supply of rental homes – but it’s very rare to see anyone write about potential solutions to the shortage.

It’s even less likely that you will see anything published that sets out to help tenants seeking a decent place to rent.

Housing affordability is seen by journalists as a hot button issue and they write about it endlessly, but usually only from the perspective that it’s hopeless for wannabee first-home buyers, that it takes decades to save a deposit and that they’re doomed to a lifetime of renting – although, clearly, none of that is true.

It’s very rare to see anything published that HELPS young buyers, with advice on how they can get into the market.

The degree to which news media is disinterested in being HELPFUL to people – focussing instead on startling everyone to create clickbait – is quite distressing.

In news media, the oldest adage of all – If It Bleeds, It Leads – still applies, sadly.

Are you ready to take your investment journey to the next level?

Look no further, because we have exciting news to share with you! We are thrilled to announce our new Hotspotting pre-recorded interviews with some of the top 1% of Australian investors who own 5 or more properties.

As you may know, in the 2020-2021 financial year, only 0.87% of investors in Australia owned 5 or more investment properties. But what do these successful investors know that the majority don't?

We have sat down with a number of them to get exclusive insights into their strategies, tips, and personal journeys. Our pre-recorded interviews bring you valuable knowledge and advice from Australian property experts who walk the walk and practice what they preach. Learn from their mistakes, successes, and unique perspectives on property investment. These interviews are a must-watch for anyone looking to build a successful investment portfolio and achieve financial freedom.

With over 71% of investors owning only one investment property, we understand the challenges and uncertainties that come with growing your portfolio. That's why we have curated a series of interviews that exclusively feature investors with multiple properties. They represent the top 1% of Australian investors and have achieved remarkable success in their investment journey.

Our pre-recorded interviews are available for you to watch at your convenience, so you can take in all the knowledge and insights at your own pace. Hear firsthand how they navigate the ever-changing property market and make profitable investment decisions. You'll be able to walk away with practical tips and strategies that you can implement in your own investment journey.

In our latest episode of 'Interviews with the 1%', we are excited to host Marion Mays, the founder of Money Strong

In this episode, hosted by Tim Graham, Marion shares her property journey that started with buying a commerical property as her first investment, followed by a string of multiple investment properties starting at the age of 25 before finding herself in a dysfunctional relationship with a 7-month-old child and having to lean on her portfolio to not only provide a safe shelter for her and her son but also to fund 15 years worth of family court litigations.

This is a remarkable story of resilience along with a great reminder that real estate not only provides great shelter and wealth creation but also security for when things turn bad.

About Marion Mays

Marion is the Founder of Money Strong- a boutique professional mentoring firm that advocates financial literacy and proactive wealth accumulation for Women and men.

Marion lives by the philosophy that “Every woman should own one little black dress & one piece of real estate in her own name”.

At a time when Australia is buckling under the weight of the dwelling shortage problem, population growth is occurring at record levels, mostly because we are bringing in migrants at unprecedented levels.

The latest data from the ABS shows that the national population rose 2.5% last year.

That means 660,000 added to the Australian population, lifting the total close to 27 million – which is a milestone achieved well ahead of the official government forecasts.

This historically high level of population growth has been fuelled by new people arriving from overseas.

Overseas migration, in fact, accounted for 83% of the increase in population last year, with the rest achieved with “natural increase”, which means that births exceeded deaths.

Net overseas migration was 548,800 – up 60% compared to the previous year.

Those numbers, startling as they are, beg one very big question: where are they all going to live?

We already have an unprecedented shortage of dwellings in this country, especially dwellings available for rental.

The current national vacancy rate, according to Domain, is 0.7%.

Six of the eight capital cities have vacancy rates well below 1%.

The building industry is unable – for a host of reasons - to produce new dwellings at the rate required to keep up with the rapid growth in household formation.

Vacancies are destined to go on falling and the serious under-supply of dwellings will not only continue, but get worse.

And that means the upward pressure on prices and rents will continue.

The politicians and talking heads of Australia are willing to consider or recommend ANYTHING as a solution to the rental shortage – anything EXCEPT the only thing that will work.

And which, incidentally, would be really easy to implement and would have much faster outcomes than the many crackpot schemes that are being suggested.

Every day mainstream media is full of articles about the rental crisis – with an emphasis on extreme situations, sensationalist headlines and the demonising of landlords as the arch-villains of the situation.

There are also growing instances of “big idea” solutions – and media loves those as well.

Some have suggested we can solve the crisis with pre-fabricated homes.

Others have suggested converting dis-used or under-utilised office space to apartments in inner-city areas.

There are moves by state and local governments to force people who use short-term letting options like Airbnb to switch to permanent rentals, but independent university analysis has shown that this won’t fix the shortage – because fundamentally Airbnb is NOT the problem.

Some states are fining people who own properties that APPEAR to be empty, such as holiday homes owned by a family for use by family members – but that won’t have any material impact either – because this, too, is not the cause of the rental shortage.

There have been suggestions of re-purposing refugee facilities or Covid quarantine facilities or army barracks as rental accommodation for the needy.

The Greens, in their collective madness, announced in the lead-up to the Queensland local government elections that they would take Brisbane’s biggest horse racing track from its legal owners and turn it into thousands of cheap homes – all for about $40 million, they said - apparently regardless of the reality that the legal owners of the land have rights and the value of the land is, realistically, measured in the hundreds of millions of dollars.

But media lapped it up and gave it enormous mileage, even though it was pie-in-sky, pixie-eyed, idealistic nonsense, with no practical merit whatsoever.

There are constant references by politicians and commentators to the need to build more dwellings, although that is NOT the solution to the rental shortage.

In terms of housing affordability, media is full of alleged solutions like tiny houses, or pre-fab houses, or land-lease arrangements (where you own the house but not the land, on which you have to pay rent).

All of this fluff in the media is a distraction from the real issues and the only viable solutions.

We have to provide incentives, rather than discouragements, to the people who provide over 90% of the homes that are rented in Australia – mum-and-dad property investors.

And politicians at all levels of government have to stop treating the housing industry as a cash cow, because THAT is the main reason why dwellings are so expensive in this country.

One of the factors we’re constantly searching for, among the thousands of markets across Australia, is CHANGE.

We’re on the look-out, every day, for locations where the performance of the property market is set to go to another level because of major changes in the local economy.

We sometimes surprise people by recommending areas that have a POOR TRACK RECORD on capital growth.

But, essentially, we don’t care about the PAST when we’re choosing locations to recommend. We’re only interested in the FUTURE.

When we find a location where a major program of infrastructure development is under way, or there’s a big change in the local economy - and we feel confident that this will generate elevated demand for real estate in the area - WE DON’T CARE if that location has delivered minimal growth in the past 10 years.

Our process, fundamentally, is about the FUTURE.

Let me illustrate the point with some case studies.

In the July 2020 edition of our most popular report – the National Top 10 Best Buys report – we listed the Sunshine Coast as our No.1 pick.

With the benefit of hindsight, it may appear to be a case of the bleeding obvious.

But, at that time, it was quite different.

NO ONE wanted to buy Sunshine Coast real estate back then because its track record on capital growth was terrible.

At that time, the long-term capital growth averages of most suburbs ranged from 1% per year to 3% per year. A 10-year growth average of 3% per year means it would take 24 years for property values to double - and property buyers want much better than that.

In the iconic suburb of Twin Waters, the median house price had dropped 13% in the previous 12 months and the long-term growth average was just 2% a year.

The vacancy rate for Mooloolaba at that time was above 3%, the precinct around Kawana and Minyama was 3.5% and at Noosa it was above 6%.

Why would anyone want to buy there in 2020? You would have to be mad, right?

But anyone who DID follow our recommendation, and bought on the Sunshine Coast in 2020, would have experienced, in the next three years, some of the most spectacular capital growth anywhere in Australia.

The median house price at Coolum Beach rose from $700,000 in mid-2020 to $1.35 million today – and median unit price rose from $450,000 to $800,000.

The median house price at Sunshine Beach rose from around $1.5 million at the start of 2020 to $3.5 million by the start of 2022. It more than doubled in two years! And the median unit price rose from $800,000 in 2020 to $1.5 million today.

At Twin Waters, which had such a poor record in 2020, the median house price rose from $800,000 to $1.5 million by mid-2022.

There are many, similar, examples throughout the Sunshine Coast market.

So, WHY did we recommend a location with such as bad track record in 2020?

Because we didn’t care about the past, we were focussed on the future.

Infrastructure projects totalling over $20 BILLION were under way or in planning.

It was a no-brainer that this would transform the Sunshine Coast market – and it did.

Here’s another example.

We were recommending locations in Perth in editions of the Best Buys report in 2021 – three years ago.

The April 2021 edition of the report featured the City of Rockingham, an affordable bayside precinct in the south of Greater Perth.

At that time, most suburbs of Rockingham had long-term capital growth rates of MINUS 1% or 2% per year. In other words, prices there were LOWER in 2021 than they were 10 years earlier!

Why on earth would anyone recommend a location where property owners had lost money for the previous decade?

Because we could see THE CHANGE coming – in that location and in Perth generally.

In the suburb of Golden Bay, the long-term capital growth average in early 2021 was -2% per year. The median house price, then, was $330,000. Today it’s $515,000 – it’s risen almost 60% in three years.

At Port Kennedy, it’s gone from $350,000 to $550,000.

There’s been a similar outcome for every suburb in the City of Rockingham in the past three years.

But at the time we recommended it, these locations had capital growth records that were among the WORST in the nation.

Now, here’s the key thing:-

Most real estate consumers would rather buy in an area where prices have grown 50% or 60% in the past two or three years, than buy in an area where prices have shown little growth recently.

There are far more people wanting to buy in Perth NOW, at the peak of the boom, than there were in 2021 before the boom started.

This makes little sense to the team at Hotspotting. We would rather buy in a location with strong future growth credentials when that market is DOWN, than when it’s at its peak.

But many investors, it seems, need the APPARENT security provided by recent high growth.

That attitude, we believe, shows a lack of understanding of real estate dynamics and fundamentals.

Here’s the key learning from this:

DO NOT let a poor track record prevent you from buying in an area that has future growth potential.

The past is often irrelevant. What matters is the FUTURE.

It’s true that if you invest wisely, you can grow substantial wealth through property investment but how big can you go?

Can you double your net assets and keep doubling them to hit a $1million or $10 million or even $1billion?

Strategic financial adviser, Andrew Courtney of Plenitude Wealth, says you can and he will join Hotspotting founder Terry Ryder on Wednesday 20 March for a webinar to reveal how the “Doubling Game” and real estate investment can accelerate the process.

Courtney, an acknowledged expert on The Doubling Game, explains it like this: If you start off with $1,000 and double it 10 times you get to $1 million. Double it 10 more times you get to $1 billion. In other words, if you could double your net assets 20 times you would be a billionaire. It's all about how fast you can double.

The challenge, as you move along the cycles, is that it becomes harder and harder to speed up the process. Courtney says "achieving this level of wealth is impossible unless you're an investor. Ideally, you would have a scalable business and you need to be an investor as well,” he says. Real estate can be central to the process. Depending on where you are in the game and how much time you have, this will determine how much real estate comes into play.

In this webinar replay Andrew & Terry discuss the level of capital you need, to achieve the income you need, to create the lifestyle that you want.

When you have a major national crisis caused by the shortage of a key product, you take steps to facilitate an increase in the provision of the thing that’s in short supply. Right?

And that would logically involve providing incentives to the people who supply the commodity that’s scarce - or otherwise creating conditions that make it easier for them to create more of that commodity.

You would, wouldn’t you?

Well, you would think so in a sensible world, but that’s not what happens in Australia.

Not in the housing market, where the opposite happens. Federal, state and local governments keep making decisions that make the rental shortage worse and the general under-supply of new dwellings worse.

In the housing market, there are two things that have a serious under-supply: there’s a shortage of new homes being built and there’s a shortage of properties available for rental.

Many people think it’s the same thing – that you fix the rental shortage by building more homes, but that’s NOT the solution.

They are two separate (although related) issues and both problems are getting more and more serious because politicians keep making them worse.

We need to build a certain number of new dwellings each year in Australia to keep up with population growth, fuelled in part by overseas migration, and the formation of new households.

In recent years, Australia has fallen well SHORT of the numbers of new dwellings needed, for a host of reasons.

The Federal Government has an ambitious target of 1.2 million new homes in five years but there is no chance of this being achieved.

One of the key reasons that we WON’T build enough new homes is because state and local politicians keep making it harder and more costly to create new dwellings.

We already have a situation where UP TO HALF of the cost of creating a new house-and-land package is government taxes, fees and charges.

Studies have shown that the taxation component of a new house ranges from 35% in cities like Brisbane and Melbourne, up to 50% in Sydney.

Politicians keep tinkering with the design of new dwellings – in theory, to make them safer, or more accessible, or more environmentally friendly – but every time they change the rules affecting the construction of new homes, they make them more expensive.

That’s the affordability problem in a nutshell. All levels of government using the housing industry as a cash cow and milk it for revenue through a range of taxes, fees and charges. And they keep making dwellings more expensive with supposedly well-intentioned new rules.

They also contribute to the shortage of new homes and the higher cost of new homes by taking people resources out of the home building industry to build headline-grabbing new infrastructure projects.

Many big real estate projects, such as high-rise apartment developments across Australia, have been scrapped because the developers can’t get the tradespeople they need or the materials they need, and because the costs are SO HIGH that building those projects is not financially viable.

In the ACT, the Territory Government has introduced new rules for the personal liability of directors of dwelling providing entities, including not-for-profit organisations like community housing providers.

These rules are so severe that it is likely to cause a mass exodus of builders and community organisations from the ACT, thereby worsening the housing shortage there.

Here’s one of the consequences of these poorly drafted laws: if you join a board of a community housing provider today, and they have a house that was built five years ago and it has defects, you can now be held personally liable for the costs even though you were not on the board when it was built.

This has come about in Canberra because the Greens, the most destructive force in Australian politics, have a share of power in the ACT government and they regard anyone involved in the housing industry as the enemy.

Make no mistake, if you own a business or if you are an owner of investment real estate, the Greens regard you as something close to a criminal who needs to be squashed.

They are obsessed with the notion that property investors are all rich bastards who own 10 or 20 properties and are monstering their tenants and ripping off the tax system.

This is patently and blatantly false, but the Greens are not interested in hearing any alternative viewpoints.

They are the petulant brats of Australian politics.

And I’m pleased to observe that, despite all their posturing and grandstanding, the Greens failed to have any impact on the election for the Brisbane City Council, the biggest LGA in the nation, or on the two state government by-elections held in Queensland at the same time.

There’s no doubt that the serious and unprecedented shortage of rental properties across Australia has been caused by political decisions that have made investment ownership less and less attractive.

Vacancy rates have been falling steadily for the past five years to the current unprecedented low levels – and you can chart the decline in the number of available rental properties with a series of state government decisions which have made ownership onerous and caused more and more investor owners to sell up and get out.

Australia’s best real estate analyst, Simon Pressley of Propertyology, confirms that there have been 20 major state government legislations in recent years, all of them detrimental to the owners of investment properties.

He points out that the Australian population has increased by 3 million in the past eight years – but, in that time, the number of homes available for rental has DECREASED 58%, and the number of homes listed for sale has DECREASED by 36%.

Those are incredible numbers which explain, in simple terms, the seriousness of the shortage crisis.

And the politicians – mostly state governments – who have caused this dire situation are still doing it. They continue to make decisions and pass laws which make it worse.

They keep slamming the people who are the source of the product that’s in short supply.

Investors who own in Victoria are selling up and getting out in large numbers, because Victoria is by far the most unfriendly state in Australia for property investors.

They have increased existing taxes on owners and they have introduced new taxes on the people who supply the product that’s in short supply.

There are big increases in land tax, a new absentee owner surcharge, a new short-stay accommodation levy and a new vacant residential land tax on empty homes.

There’s also a new construction code which increases the costs of new dwellings and there are restrictions of rental increases.

James Kirby, wealth columnist for The Australian newspaper, commented on 15 March that the taxation nightmare imposed by the State Government was the reason why Melbourne is the worst-performing residential property market in the nation.

As a result of these measures, in just one month, the vacancy rate in Melbourne dropped from 1.5% to 1.0%, a huge change in such a short time frame. And, believe me, it will get worse.

But it’s not just Victoria. Every state and territory has made changes that shift the power balance to tenants and/or increase the costs of owners, causing more and more investors to sell.

South Australia has recently launched changes to its tenancy laws.

The political statement says: “New rental laws have been passed by the Parliament of South Australia to improve protections for tenants WHILE BALANCING THE RIGHTS OF LANDLORDS.”

That’s the political rhetoric. Here’s the reality: there are 17 major changes, all shifting the balance to tenants.

For example, reduced rental bonds, a ban on rental bidding, restrictions on what you can ask tenants when they applying to rent your property, limits on rent increases, new rights to tenants to sub-let, new penalties on landlords for various breaches (but none for tenants), restrictions on ending tenancies, more rights to tenants in disputes, the notice period to end tenancies increased from 28 to 60 days, a limit on inspections by your property manager, you can’t refuse pets, and new rights to tenants to make modifications to your property.

And the measures which balance the rights of the property owners?

Well, there are none.

And that, in simple terms, is why we have a chronic rental shortage which has no end in sight.

It keeps getting worse, because state governments keep making it so.

The most successful property investors that I know have some features in common and making decisions based on research is one of the key ones.

But those people are relatively rare.

It seems to me, from observing the behaviour of investors for the past four decades, that more people make investment decisions based on media soundbites than on genuine research.

Far too many people are leaping recklessly into the Perth property market because mainstream media keeps telling them that prices are booming and will keep on booming, backed by commentary from real estate people who have a vested interest in prolonging the Perth boom for as long as possible.

At Hotspotting, we think this media soundbite approach is fraught with peril and that many of the people piling into the Perth market at the moment will regret their decisions, made in haste without proper due diligence.

It’s a reflection of those views that the new edition of the National Top 10 Best Buys report does not include any locations in Perth.

Based on detailed research, we think this market has peaked and will not be the national leader on price growth in 2024, as many are predicting – or hoping.

We think there are other, better places for people to be putting their money – safer, less volatile, less heated markets with good potential for capital growth.

Our choices for good locations to buy in 2024 are based on research-based knowledge of the key trends that are driving demand in the best locations across Australia.

We’re not focused on short-term sugar-hit gains – rather we’re focussed on places we think will do well in the medium to long term.

We base our choices on economic factors, on demographic trends and on the locations of influence from big infrastructure developments.

At Hotspotting, we are constantly on the look-out for evidence of change in property market trends and in individual locations.

Places that have been weak performers on capital growth in the past can become the leaders of the future, because something major has changed in that market – often caused by the development of major new infrastructure.

Sometimes it’s a significant demographic shift – such as the trend which has seen growing numbers of people leaving the biggest cities and moving to smaller cities or to regional areas, in search of a different and more affordable lifestyle, enabled by technology.

More recently, we have observed a surge in demand for units and townhouses by a range of different buyer cohorts, for a host of different reasons – and this is changing one of the dominant paradigms of real estate – that houses outperform units on capital growth.

All of these factors are reflected in our new edition of the National Top 10 Best Buys report.

It’s our most popular report, because it’s the one that considers all the events and trends happening across Australia – and identifies the markets with the best prospects for future capital growth.

In our latest episode of 'Interviews with the 1%', we are excited to feature Best-Selling Author Nicola McDougall.

In this episode Nicola shares her property investment journey including her parent's teachings, purchasing her first property tenants in common with her brother and growing her portfolio from there.

Nicola details the struggles that women can face on single incomes but shares some tips on how to make the most out of your situation.

About Nicola

Nicola McDougall is one of Australia’s most well-known property investment experts and is the co-author of the best-selling book, The Female Investor – Creating Wealth, Security & Freedom Through Property and Property Investing For Dummies (3rd Australian edition).

She is also a multi-award-winning property and finance journalist, industry spokesperson, business owner, and successful property investor.

The housing crisis in Australia has been the hot topic for a number of years now. But how did we get here?

Tune in to our latest podcast with Terry Ryder & Simon Pressley of Propertyology. Arguably two of the best minds in Australian Real Estate.

About Simon Pressley

Managing Director of Propertyology and 3-time Australian (REIA) Buyer's Agent Of The Year, Simon Pressley was inducted into the Australian Real Estate Hall of Fame in 2015.

Simon is passionate about helping everyday Australians to build a more sustainable lifestyle through making astute property investment decisions. He (unapologetically) is renowned for challenging conventional wisdom to help people have a smoother journey to a better destination.

A strong lateral thinker and a thought leader, Simon spends several hours everyday studying the property economics of Australia's towns and cities. His strong and passionate opinions are often featured in the media.

The chronic housing shortage that we’ve been hearing so much about lately is getting worse – and will continue to get more and more serious.

Three major measures of the supply of homes, both for purchase and for rent, are heading in the wrong direction for a nation that needs solutions from our politicians.

Building approvals continue to fall when the nation needs them to be rising, loans for the purchase of new dwellings are also heading in the wrong direction, and vacancy rates continue to go lower, when the one-third of households that rent need them to rise to take the pressure off rents.

And what are our state and federal governments doing to solve this crisis?

Well, collectively, they’re making it worse.

They keep passing laws that make owning an investment property more and more onerous, causing growing numbers of owners to sell, thereby reducing the rental pool and making vacancies worse.

They also keep adding to the costs of creating new homes, which makes it harder for the building industry to provide the new supply the nation needs.

The Federal Government has set the grand target of 1.2 million new homes over five years but, as is so often the case with politicians, they haven’t thought much about it beyond the press conference.

When the Government says it’s going to build 1.2 million new homes, what it really means is that it hopes the building industry can somehow deliver its target - without actually having any policies to address the problems which will mean this grand objective is unattainable.

All the latest data shows how far behind we are in terms of achieving this goal.

Currently, the production of new dwellings in Australia is the lowest it has been in 12 years.

Approvals to build new houses showed an almost 10% decline in January, compared to December. Seasonally adjusted, the January numbers were the weakest since June 2012.

In the past 12 months, there have been approvals to build 101,000 new houses, the lowest in more than a decade.

The ABS data shows that new house approvals have fallen in four of the past six months – and there is a clear pattern of decline in new homes at a time when we need it to be picking up.

Meanwhile, the Housing Industry Association says that the number of loans issued for the purchase and construction of new homes fell by 4.2% in January and remains at its lowest level since 2008.

HIA Chief Economist Tim Reardon says lending for new homes was at record lows in 2023, and this downward trend has continued into the new year.

The trend surprises no one in the housing industry, where there is widespread cynicism about the Federal Government’s grand announcement, without any policy substance to deal with the many issues that plague the home building industry.

There continue to be shortages of materials and tradespeople, costs continue to be high, elevated interest rates don’t help and we continue to see building companies go broke week by week.

Australia is currently having a boom in infrastructure construction and that has sucked a lot of resources out of home building.

State Government and local council meddling with the process continues to cause costly delays and to add to the cost of building new homes, making it increasingly difficult to operate profitably.

The weakness in building approvals nationally is being seen at a state level as well.

In Victoria, the number of houses approved for construction has dropped to the lowest level for over a decade – with approvals in January the lowest since October 2013 – and this in a state where the State Government had said it would build 800,000 new dwellings in a decade.

Victoria has one of the weakest situations in the nation, not helped by having the highest property taxes among the states and territories - with new imposts being imposed in 2024 to further discourage investment and construction.

In Tasmania, building approvals have dropped 30% in the past two years.

Indeed, in January private sector house approvals fell in all states, including by 17% in Victoria and by 13% in NSW.

The third measure of the chronic dwelling shortage is vacancy rates for rental properties, which have been dropping steadily for the past 5-6 years.

They were already at historic lows across Australia but the latest vacancy rate data shows them going lower still.

The national vacancy rate recorded by SQM Research fell from 1.3% in December to 1.1% in January, with vacancies falling in all eight capital cities.

State and territory governments continue to make decisions and pass laws that are detrimental to property owners, causing investors to sell, thereby reducing the rental pool further.

Investors owners are already faced with massively increased costs through higher interest rates, increased council rates, rising state taxes, higher insurance premiums and increased maintenance costs.

Years of detrimental decisions by governments has created this chronic rental shortage and it continues to get worse.

The Victorian State Government is introducing a raft of measures in 2024 which collectively are a major discouragement to property owners – and more and more investors are selling up and getting out of the Victoria.

It’s significant that, according to the SQM Research figures, the biggest decrease in vacancy rates was seen in Melbourne, which dropped from 1.5% in December to just 1.1% in January – a massive change in a single month.

Another property data source, PropTrack, also puts the national vacancy rate at 1.1% - but a third source, Domain, has an even lower figure – just 0.7% in February, down from 0.8% in January.

This is a new record low, according to Domain, which says the mismatch between low supply and rising demand is an ongoing challenge for tenants amid rapid population growth (boosted by overseas migration), a strained construction sector and rising property prices locking people into renting for longer.

According to the Domain figures, six of the eight capital cities have vacancy rates below 1%, including just 0.3% in Adelaide and in Perth.

All of this information presents a grim picture for the supply of homes, both for sale and for rental, across Australia - and means that prices and rents will continue to increase.

They say that insanity is doing the same thing over and over again and expecting different results.

By that definition, many of the nation’s most high profile economists are insane.

One of the defining characteristics of Australia’s leading economists is that they will never change their theories about housing markets and property prices, no matter how often they are exposed as being wrong.

The senior economists working for the big banks continue to discuss the entity they call “the Australian property market” in terms of interest rates as the biggest factor of influence, despite having their views cruelly exposed by the results of 2023 (when they all predicted prices to fall 15% or more because interest rates were rising, only for prices to rise strongly).

Their forecasts are ALWAYS wrong because they think it’s all about interest rates and they refuse to admit that their simplistic mindset is flawed. So they keep getting it wrong.

But perhaps the greatest example of refusing to let go of pet theories, despite repeated failures, comes from the senior economist for AMP Capital Shane Oliver, who gets my award as the worst forecaster of property price trends in the nation.

Oliver has long had his nose out of joint because property prices refuse to behave themselves, according to his world view, and because housing is “over-valued”, according to his cherished theories.

It was Oliver who famously went public in 2005 to declare there would be no growth in property prices across Australia for the next 10 years because property was massively over-valued back then.

Here’s what he said in 2005: “House prices are at least 25% over-valued and may not start to rise again for another decade. It will take 10 years for rents and wages to catch up with house prices and there will be no rise in the housing market until they do so.”

But, of course, property prices did indeed rise between 2005 and 2015 – a lot.

According to the ABS, Sydney’s median house price rose from $494,000 in 2005 to $864,000 in 2015, while Melbourne increased from $320,000 to $570,000 and every other capital city had similar increases.

There were also big increases in median prices for apartments in ALL of the capital cities.

So how could a senior economist for a major national institution get it so wrong?

Essentially, it’s because of the belief that house prices should be intrinsically linked to other factors like rents, for example, as declared by Oliver back in 2005.

But there is no evidence I’m aware of that this linkage exists. In my 40-plus years researching and writing about Australian residential real estate, I have never seen any evidence that the level of house prices is dictated by residential rents, or influenced by them in any way.

House prices rise because of competition in the market. If a house is for sale and there is more than one person interested in buying it, this will tend for put upward pressure on the price. This is particularly so in an auction situation, but can also happen in private treaty sales.

This is notably so in recent times, with ongoing strong demand for properties (inspired in part by strong population growth, boosted by high migration levels) at a time when supply is historically low.

We are not building enough new dwellings and there is a shortage of listings of properties for sale, relative to buyer demand.

So, prices are rising. Competing buyers at an auction don’t spend any time thinking about rental levels, keeping in mind that the vast majority of buyers in the market are home buyers, not investors.

Now, here’s the broad definition of fair market value used by the people whose job it is to estimate such things, property valuers:

“The estimated amount for which a property should exchange on the date of valuation between a willing buyer and willing seller in an arm's-length transaction after proper marketing wherein the parties had each acted knowledgeably, prudently, and without compulsion.”

You will note that there’s nothing in there about connections with residential rentals or current wage levels. It’s simply about the price arrived at in a competitive market.

But, despite being so spectacularly wrong about what would happen to property values in the decade following 2005, not to mention his forecasts for price outcomes in Australia in the past several years, has Oliver discarded his theory and sought something more credible?

Sadly, no.

Oliver burst into print again in early March to declare, again, that house prices have outstripped what he terms “fair value” in many parts of Australia.

He published an analysis, for want of a better word, that found that house prices across Australia were over-valued by “more than 29%”.

In Sydney, he said, houses are over-valued by “almost 33%”, which means the median house price needs to fall by $458,000 to be considered fair value, according to his beloved theory.

Brisbane was over-valued even more, by 33.5%, and Canberra by 31%, while in Melbourne it’s 26%, according to Oliver.

What he is saying, effectively, is that everyone involved in the housing market – buyers, sellers, valuers, buyers agents and selling agents – are all idiots behaving foolishly.

How has he arrived at this stunning conclusion?

By comparing price levels with rents, in the same way as a price-earnings ratio for shares – the same method he used back in 2005 when he was so utterly wrong with his forecast for house prices for the next 10 years.

Here’s the big difference: everyone who buys shares is an investor; most of the people who buy houses and apartments are not investors, they’re home buyers, and they don’t spend a single moment considering how the price they are paying relates to how much rent they could get for the property – because they plan to live in it themselves.

Oliver’s belief is that property markets should work the same way as equity markets in determining value.

But the key point is that they DON’T. He may think they should, but they DO NOT.

Never have – and, I dare say, never will.

I note that the head of Australian economics for Commonwealth Bank, Gareth Aird, strongly disagreed with Oliver’s assessment in the same articles that published it.

Aird said that “over-valued” was a strong term and commented: “Unless you think house prices are going to fall, you can’t call them over-valued.”

Well, exactly.

Current price levels have been determined by the free and open market, as they have always been – and, far from being over-valued and therefore set to fall, dwelling prices are set to rise in 2024 in most parts of Australia.

Meanwhile, Oliver clings to a theory that was spectacularly wrong almost 20 years ago and has contributed to his extraordinary track record of failed forecasts about property prices since then.

In our latest episode of 'Interviews with the 1%', we are excited to feature Simon Pressley of Propertyology. This is an absolute must-see episode with arguably two of the best brains in real estate here in Australia.

In this pre-recorded video Simon shares his strategies, experiences, and lessons learned along the way, giving you an inside look into how he has built his impressive portfolio.

About Simon Pressley

Managing Director of Propertyology and 3-time Australian (REIA) Buyer's Agent Of The Year, Simon Pressley was inducted into the Australian Real Estate Hall of Fame in 2015.

Simon is passionate about helping everyday Australians to build a more sustainable lifestyle through making astute property investment decisions. He (unapologetically) is renowned for challenging conventional wisdom to help people have a smoother journey to a better destination.

A strong lateral thinker and a thought leader, Simon spends several hours everyday studying the property economics of Australia's towns and cities. His strong and passionate opinions are often featured in the media. Do yourself a favour and don't miss this one!

Australians are passionate about real estate and over two million of us own investment properties, while many more have aspirations to acquire property to grow their wealth and provide for their retirement.

But while the nation is full of people with ambitions in real estate, the reality is that relatively few people are successful with property investment.

As a nation, we’re not particularly good at property investment.

The official data shows that while more than two million Australians participate in property investment, 72% have just one property and another 18% have two.

That’s nine out of 10 investors with just one or two properties.

Those who have a portfolio - owning five or more properties - are less than 1% of the total.

The question is: why do so few achieve success with property investment?

I think it’s fair to say that most people come to real estate investment with ambition.

There’s often a dream of acquiring multiple properties and funding retirement with the proceeds of those real estate assets - possibly even retiring early.

But the data shows that most people get stuck on just one or two properties.

Why is it so?

Our experience with investors and prospective investors suggests a number of reasons:-

Many investors are herd animals, who jump into the market when they hear or read there’s a boom happening, rather than having a defined strategy heading towards a clear objective.
Far too many people are unwilling to invest in good advice and information before spending the big dollars on buying a piece of real estate – and that’s the worst kind of false economy.
Many wannabe investors are wait-and-see people - they find myriad reasons to procrastinate and avoid making decisions and moving forward - the next RBA board meeting, the result of the next election, the negative forecasts of economists, and many others.
For all of these reasons, many investors make a hash of the first investment - buying in the wrong location, paying too much or failing to do proper due diligence and ending up with a property that doesn’t perform. This makes it hard to move forward to acquire more properties.

The objective of the Hotspotting team is to help as many people as possible avoid these mistakes and make a success of property investment.

As part of that goal, we have created a podcast focused on the 1% - the special cohort of people who have created a substantial property portfolio.

In “The 1%” podcast, we interview some of Australia’s most successful property investors and advisers to find out the keys to their personal success and to learn how others can follow their lead and be part of the elite few who make it big in real estate investment.

There’s no better way to do property investment well than to follow the example of those who have made a success of it.

Internal migration, which means people moving from one part of Australia to another, continues to be a major driver in real estate markets across the nation.

The trend we call The Exodus to Affordable Lifestyle is still pumping, with large numbers of people relocating from the biggest cities to regional areas in pursuit of a different lifestyle at cheaper prices.

The latest data and analysis from a range of sources, including the Regional Australia Institute and real estate data company CoreLogic, confirms that this remains a major demographic force, with major consequences for real estate.

It was not, as media has incorrectly portrayed, a trend generated by the Covid lockdowns. It has been happening for much longer than that and it continues to be a significant force.

Queensland has long been, and remains, one of the nation’s chief beneficiaries of this mass movement of people in search on affordability and lifestyle, powered by technology which has enabled more and more people to work remotely.

This has impacted real estate markets across the state, from the Gold Coast at the NSW border up to Townsville and Cairns in North Queensland.

In the new 2024 edition of Rising Stars, a report written by Hotspotting in conjunction with the nation’s biggest comparison website, Canstar, Queensland is ranked as the regional market with the strongest prospects for the coming year.

The Rising Stars report uses five key metrics to rank the 14 major market jurisdictions - the eight capital cities and six state regional markets - on their prospects for growth in 2024.

Queensland was rated the strongest regional market and ranked fifth overall among the 14 market jurisdictions.

It ranked in the top 4 nationally on three of the five metrics – sales activity, short-term price growth and infrastructure spending. It also produced solid ratings on vacancy rates and rental growth.

The combination of its solid performance across a range of measures has resulted in a strong overall ranking – and gives substance to the expectation that Regional Queensland markets will be among the nation’s out-performers in 2024.

Hotspotting has just published its annual report with Australia’s largest comparison website Canstar, the one we call Rising Stars.

In the Rising Stars report each year, we use five key metrics to rank the 14 major market jurisdictions in the nation - the eight capital cities and six state regional markets.

The report ranks the 14 market jurisdictions from 1 to 14 on their prospects for growth in the coming year.

The 2024 edition of Rising Stars ranks Brisbane No.1 - the market with the best prospects to provide growth in the next year or so.

Brisbane is a standout on all the five metrics we use to arrive at our ratings - sales activity trends, recent price movements, vacancy rates, rental growth trends and infrastructure spending.

Indeed, Brisbane ranks in the top 3 in the nation in all of those metrics except vacancy rates, with particular impact from rising sales activity, recent price growth and high rental growth, as well as a big infrastructure spend.

The market performance we expect from the Queensland capital in 2024 continues the excellent results of last year, when Brisbane was one of the top three markets in the nation for house price growth and Australia’s best performer on price growth in the unit market – a factor which is becoming increasingly important around Australia.

According to CoreLogic, the median house price for Brisbane rose 13.3%, which was second behind Perth, while both PropTrack and Domain rated Brisbane the strongest unit market in the nation for annual growth in unit prices.

The ranking in the new Rising Stars report suggests Brisbane is poised with another stellar year in real estate, boosted by rising population thanks largely to internal migration, a solid underlying economy and a massive infrastructure spend - with more to come as the city works towards its destiny as the host of the 2032 Olympics.

Are you ready to take your property investment game to the next level? Catch the replay of our exclusive webinar hosted by Tim Graham from Hotspotting, featuring special guests Chris and Zen Christofi from Reventon. During this webinar, Chris and Zen unveiled the highly sought-after Reventon Formula that has been transforming the lives of Australians since 2005. This proven formula has helped thousands of individuals grow substantial property portfolios as well as help pay down owner-occupier debts, achieving remarkable results in the process. Don't miss out on this opportunity to gain valuable insights and strategies from industry experts who have a track record of success spanning close to 20 years.

Australia's #1 Buyers Advocate InvestorKit’s analysis of the fundamentals says Yes!

The best forecasters of real estate trends are the specialists dedicated to researching markets daily.

They’re not bank economists and media commentators who occasionally turn their attention to the housing market.

They’re the full-time dedicated professionals who have picked apart property dynamics to understand the trends and why some locations perform better than others.

They’re people like Arjun Paliwal, director and head of research at InvestorKit.

Bank economists believe one dominant factor dictates property markets: interest rates. And that’s why they always get their forecasts wrong.

The researchers at InvestorKit have a far deeper understanding of real estate: they have developed their own unique methodology based on 25 core fundamentals. And they have a pressure-based market scoring system to identify which markets will outperform. That’s why their forecasting record puts the big banks in the shade.

Hotspotting founder Terry Ryder speaks to Arjun Paliwal of InvestorKit in this recent webinar. This is priceless information you won’t get anywhere else.

It looks increasingly likely that we have passed the end of the interest rate cycle and that the next change by the RBA is likely to be a REDUCTION in the official cash rate.

In the meantime, mortgage rates will remain high, compared to their levels prior to May 2022, when the first increase by the RBA occurred.

The general consensus from economists – who are, let’s face it, not particularly good with forecasting anything to do with the housing market – is that any reduction in interest rates will be in the second half of the calendar year.

So, for the foreseeable future, we are going to see most investors seeking locations that offer above-average rental yields – to give them the best chance of securing an investment property that pays all or most of the costs of ownership.

This means our special quarterly report, The Pulse, will continue to be one of the most important and relevant among those published by Hotspotting.

The Pulse identifies 50 locations across Australia with affordable prices and above-average rental yields – but, importantly, they are places which also have good credentials for capital growth.

Let’s face it, Australia has many regional towns with cheaper prices and high rental yields, but very little prospect for price growth.

In Broken Hill in the far west of NSW you can buy the average house for under $200,000 and the gross rental yield is around 10%, which may sound appealing, but capital growth prospects are weak. Homes are cheap there for a reason.

With The Pulse, we identify 50 places with growth prospects, as well as prices that are within reach of MOST investors - and rental yields ranging from 5% to 8%.

With The Pulse package you get a spreadsheet summarising the main attributes of the 50 locations, plus a report with key background detail on each of those 50 places.

It’s a product designed for the times we are in, where growth locations offering better than average rental yields are a key metric sought by many real estate consumers.

One of the reasons we seldom find solutions to serious problems in Australia is that we never seem able to have a calm, honest and rational debate about any of the issues.

This is particularly true in the housing market, where housing affordability has been an ISSUE OF ENDLESS DEBATE for decades, without any improvement in the situation.

The rental shortage crisis has been building for years, and there is daily media coverage of the problems, but no one among the political leadership anywhere in Australia has presented any solutions.

The problem is that when politicians get hold of an issue, honesty and integrity goes out the window.

The standard of debate quickly descends to the gutter, as politicians concentrate on point scoring, indulging pet philosophies and finding scapegoats.

Stake-holders in the housing markets don’t help either, by arguing for their vested interests rather than win-win solutions that take into account the needs of all parties.

Within this climate, every year or two the issue of negative gearing is raised as an issue – and for some this is the bogey man that is the source of all evil in the housing market, causing rising prices, high rents and every other thing that people like to complain about.

Negative gearing is arguably the most misunderstood concept among all the things that happen in real estate markets.

This is largely because politicians, particularly the Greens and sometimes the ALP, like to muddy the waters with misinformation, as part of their political tactics.

In the mindset of Greens politicians, anything to do with property investment is the embodiment of evil and needs to be stamped out.

One of the myths about negative gearing is that it’s a tax benefit exclusive to property investors. It’s not – it’s available on other types of investments as well.

Another myth is that everyone who owns an investment property gets tax deductions through negative gearing. That also is very untrue – and I’m an example. I’ve been buying properties since the 1980s and I have never claimed negative gearing tax benefits.

Another furphy about negative gearing is that it’s an Australian thing – that we’re the only country that provides this tax break to investors.

That’s one of the biggest lies perpetrated by those who regard property investors as the source of all evil in the residential property industry.

The reality is that many first-world nations have similar systems to the one in Australia, including Germany, Japan, Canada, Norway, France, the United States, Ireland and Finland, among others.

Other misinformation about negative gearing relate to how much it costs the Federal Budget – always exaggerated quite dishonestly by the Greens and others – and the claim that ALL property investors claim negative gearing benefits.

Perhaps the biggest lie is that negative gearing is responsible for rising prices and poor affordability.

There have been many independent studies by reputable organisations which disprove this throw-away line from those who oppose property investment.

The reality is that MOST buyers in the market, overwhelmingly, are HOME BUYERS - and that they comprise the MAJOR force for competition for dwellings and therefore for upward pressure on house prices.

My estimate is that, currently, less than 15% of buyers in the market are negatively-geared property investors – and it’s difficult to argue that they somehow overpower the other 85% and cause prices to rise.

There are more first-home buyers in the market than there are negatively-geared investors.

But those investors are often blamed for the high prices paid by first-time buyers – but, in reality, expensive housing is caused by the politicians who are adept at blaming others.

It’s really disheartening sometimes to see how bad the media coverage of real estate is in Australia.

The media’s standard treatment of the affordability issue is a prime example. Mainstream media delights in running the story line that first-home buyers are priced out of the market and that’s not even worth trying to find a home.

That story has run pretty much every day, somewhere in the national media, for not just years but for decades.

One particularly ridiculous treatment of this cliché came with a headline that asked whether it was “really possible” to find “a home in an Australian capital city for under $750,000” and a story that suggested that it was almost IMPOSSIBLE to achieve.

This article, like so many on the subject, was shallow, pointless and just plain wrong.

Here’s the reality. The median dwelling price in Perth, according to PropTrack, is currently $640,000 – which means half of all sales are for less than $640,000.

So, can you find a home for under $750,000 in Perth? Obviously, even in the hot Perth market, there are myriad possibilities.

In Adelaide, the median price is slightly over $700,000 – which, again, means half of all homes are selling for less than that figure. No problem finding a home under $750,000 in the South Australian capital.

Darwin? The median price is $480,000.

Hobart? The median there is $670,000.

Even in larger and more expensive cities like Melbourne and Brisbane, the medians are around $790,000 – so also lots of options below $750,000 there as well.

Nationally, according to PropTrack, the median dwelling price is $760,000 – and, to labour the point, that means half of all sales for prices lower than $760,000.

So why would a media outlet that wants to be taken seriously suggest it’s almost impossible to find.

Clearly, this article and its headline, like so many, are inaccurate and blatantly dishonest.

The objective here, of course, is NOT to help people. Media’s objective is NEVER to be helpful.

The goal is to alarm, to dismay, to startle.

Shame on the journalist who wrote it and on the media outlets that published it.

Another of the things media always does, in its efforts to perpetuate the fallacy about affordability, is to completely ignore ATTACHED dwellings as part of the solution.

For young Australians, and many other buyer cohorts as well, units and townhouses are valid options in the search for well-located homes at affordable prices.

Earlier in this commentary, I gave the median dwelling prices for most of the capital cities of Australia and showed that there were lots of options under $750,000.

The exception, of course, is Australia’s most expensive city, Sydney.

But for buyers happy to consider units and townhouses as potential solutions, even Sydney provides lots of options.

According to PropTrack, the median unit price for Sydney is currently $790,000. Half of all sales have been below this figure, so clearly buyers can find options below that benchmark of $750,000 set by that shallow media publication.

The median unit price across the capital cities of Australia a little under $650,000.

In regional Australia, it’s $555,000.

Why does mainstream media never consider units when discussing housing affordability?

Because it doesn’t suit their preferred narrative, which is to tell people that there are no affordable options anywhere and they should be outraged.

As I said, media’s objective is NOT to be helpful. Their goal is to create clickbait and they’re willing to be dishonest and inaccurate in achieving that.

In our latest episode of Hotspotting Podcast, Tim Graham had the privilege of speaking with Steve Palise, founder of Palise Property and a true master in the world of Commercial Property Investment. Steve walked us through the importance of diversification within our portfolios and how Commercial Property can be a valuable asset in achieving that.

In this episode, Steve shares his extensive knowledge of the differences between residential and commercial property investments, debunking common myths that may have been holding you back. He also discusses the rising trend of commercial property investments and how you can tap into this lucrative market.

Steve's unique journey from being a chartered engineer to a leading figure in property investment and education makes him the perfect guest for our podcast. With well over 1000 properties secured for his clients and a diverse portfolio across Australia, Steve's expertise is second to none.

But the best part is, Steve has generously offered our Hotspotting viewers a free copy of his book on commercial property investment. This is a valuable resource for both new and seasoned investors looking to maximize their returns and diversify their portfolios. Don't miss out on this insightful conversation with one of the industry's best.

Tune in to our latest episode of Hotspotting Podcast and learn how you can benefit from commercial property investments with Steve Palise of Palise Property.

To take advantage of Steves offer, please visit www.paliseproperty.com and use the code: "HOTSPOTTING"

The man in the image behind me is Australia’s most dishonest politician.

I know this is a big statement, because Australian politics abounds with dishonesty, deception and bastardry.

We have a Federal Government which has routinely broken its election promises, including the ones about tax cuts and about taxation of superannuation, and they’ve been in power less than two years.

We have politicians on all sides of the political divide who habitually tell lies in Parliament and in front of the media, as the current Federal Government did on the issue of implementing the promised tax cuts.

They were still lying about that the week before they finally admitted they wouldn’t be implementing the tax cuts as promised at the election and repeatedly since then.

They say we get the politicians we deserve and in Australia we certainly do, because we don’t punish the politicians who lie to us.

But Adam Bandt, the Federal Leader of the Greens, is at another level of dishonesty.

He constantly and consistently misrepresents the housing industry and the people who participate in it, in the interests of achieving media profile and presenting himself as the saviour of those who rent.

He is, in fact, the opposite of their saviour. He’s their nemesis. If his policies on the rental market were implemented, it would turn the current rental shortage crisis into a catastrophe, with vacancies even lower than the current average of just 1%, which is already an historically low figure.

But Bandt appears to believe his stance is a vote winner and he’s happy to lie to achieve his goals.

Every time he speaks on this issue, he seeks to characterise the average investor as someone who owns 6 or 8 properties and wants more.

The official data from the ATO shows that less than 1% own more than five properties. 90% of those who own investment properties own 1 or 2, of which 72% own just one.

And they’re mostly people on average incomes, trying to improve their financial situation. They are not, as the Greens leader claims, the wealthy elite of the nation with massive property portfolios, ripping off the taxation system.

Bandt also frequently blames investors for high property prices and poor affordability, without presenting any evidence to back up his sweeping statements – and ignoring the reality that investors comprise less than 30% of buyers and that most of the people out there competing for dwellings – and therefore pushing up property prices - are home buyers, including first-home buyers.

There has been a number of independent research studies recently on the major drivers of high property prices – and I emphasise that these are genuine research studies, not sweeping statements by attention-seeking minor politicians or people with a vested interest in the argument.

Reports by the NSW Productivity Commission and by think tank The Centre for Independent Studies have both independently concluded that the biggest reason prices and rents have risen is planning restrictions by politicians and bureaucrats, particularly those that prevent greater density of development in existing suburbs.

These reports argue that rising prices have not been caused by negative gearing or other investor influences, but by planning restrictions which have prevented a good supply of affordable new dwellings.

But the Greens happily ignore these inconvenient truths.

And if Bandt has his way, investors will be hounded out of existence, because property investment will be no longer viable if his policies were implemented.

And the issue that political parasites like Adam Bandt never address is this: if you squash property investors the way he and his cohorts want to, where are the rental properties coming from?

New data from Australia’s best research analyst, Simon Pressley of Propertyology, confirms there are 3.5 million rental homes in Australia - and 3.2 million of them are provided by private investors.

That’s 91.4% of rental homes supplied by everyday mum-and-dad investors. Only 300,000 rental homes are provided by government.

If you drum investors out of existence, as this idiot wants to do, there needs to be a plan for how you replace those three million homes provided by the investors that the Greens want to squash.

Presumably they expect state governments to step up and provide all the rental dwellings that the nation needs.

And the cost of providing 3.2 million rental homes – conservatively – is $1,300 billion.

Can anyone suggest a state or territory government in this country which has a few hundred billion dollars to spare to replace what is currently provided by mum-and-dad investors.

Mr Bandt – what’s your policy for achieving this?

It’s a rhetorical question – I know you don’t have one.

All you have is a burning and rather unsettling hatred for anyone who owns an investment property.

There are two standout factors for investors to be aware of when seeking capital growth in the current market.

One is that two of the smaller capital cities are the national leaders on price growth and the other is that apartment locations are among the best performers in the nation.

The Perth boom has been well-publicised and many investors are keen to be part of the growth that has been occurring in the WA capital.

In our latest report, we have broadened the scope to include some key regional WA locations which also provide good prospects for growth, as well as affordability and strong rental yields.

The market that has been challenging Perth for the title of national growth leader is Adelaide, which actually out-performed Perth on the increase in median house prices in 2023, according to some of the major research sources.

Adelaide continues to provide broad appeal for investors, as it remains one of the nation’s most affordable city markets, with ongoing strong prospects for price increases as this market is underpinned by Australia’s No.1 economy, according to the State of States report published by CommSec.

Adelaide also has the lowest vacancy rate in capital city Australia, alongside Perth, with significant growth in residential rentals as a consequence.

Our new edition of Top 5 Adelaide Hotspots highlights the areas in the SA capital that we believe have the credentials for ongoing increases in property values.

The big emerging new trend in Australian real estate is the rise and rise of well-located apartments as a target for more and more buyers across the nation.

Many of the key cohorts of buyers – including downsizers, first-time buyers, lifestyle buyers and investors seeking affordability and higher rental yields – are choosing to buy attached dwellings.

And we are seeing a rising number of instances where units are out-performing houses on capital growth.

In locations right across Australia, there are numerous suburbs where the growth in the median price has been higher for units than for houses, both in the past 12 months and in the longer term.

Apartments are considerably cheaper than houses on land and usually offer significantly higher rental yields, so they are increasingly worthy of consideration by investors.

To help our customers tap into these key growth markets across Australia, we have created a special bundle of three reports – the Perth, Adelaide and national apartments reports – which can be accessed in one purchase at an attractively low price.

Buying this Leap Day Bundle can give you key information about the nation’s leading growth markets and save you over $200, compared to buying each of the reports separately.

In today's podcast, we sit down with Warren Livesey, the founder of Buy Airspace, to discuss this innovative solution in more detail.

Warren shares his expertise and insights on the growing airspace real estate market and how strata owners can benefit from this untapped opportunity. He also delves into the legal and practical aspects of selling airspace, as well as the potential impact on the community and the environment.

Tune in to this enlightening conversation with Warren Livesey of Buy Airspace to learn more about the potential of unlocking the airspace above your property.

Don't miss out on this groundbreaking opportunity to generate revenue and support sustainable development in your community.

The governments of Western Australia and Victoria provide a stark contrast in how to address the chronic rental shortage that is afflicting both states – and every other part of Australia.

WA has adopted the enlightened approach of providing encouragement and incentives for people to buy properties in Perth and make them available for long-term rental – which is the only viable way to solve the shortage problem.

Victoria, on the other hand, has decided to punish investors for being investors. You could almost believe that the politicians running Victoria believe property ownership is a criminal activity.

This may help to explain why property investors are heavily focused on buying in Perth and key WA regional markets, while investors are more likely to be selling than buying in Victoria.

The difference is that WA has introduced measures to encourage investors in that state.

One targets those who own a property used for short-term letting, such as Airbnb, with a cash incentive from the State Government to convert to long-term rental for permanent tenants.

Another WA initiative is to encourage property owners to build granny flats to increase dwelling supply, increase urban density and slow urban sprawl.

The relaxed amendments to the state’s Residential Design Codes will boost housing supply by removing the minimum lot size requirements for an ancillary dwelling, commonly known as a granny flat.

The alternative housing type will no longer require council planning approval and can be constructed on any property lot size. The key stipulations are that new dwellings will need to meet setback requirements and must not exceed 70 square metres in size.

In a further measure to increase dwelling supply, the WA Government is offering residential builders interest-free loans to help them complete unfinished properties.

The Builders’ Support Facility will provide interest-free loans to support eligible residential builders to complete new homes that have been under construction for more than two years.

All of that makes a lot of sense. It adopts the approach of encouraging people to take desired actions by offering incentives.

The opposite approach is to financially punish people who don’t do what politicians want, even though the actions by property owners are legal and perfectly reasonable.

And that’s the approach taken by Victoria, which has the worst State Government in the nation, although there are plenty of others doing their jobs poorly.

In Victoria, if you’re a property investor, you’re treated on a similar level to drug dealers and mafia figures.

If you own a block of land and haven’t built on it yet, you’ll be punished with a new tax.

A new vacant residential land tax will apply right across Victoria from next year.

If you own any type of investment property, you’ll pay considerably more in land tax, with the State Government lowering the threshold so that everyone who owns an investment property will be slugged with land tax this year.

The Victoria government has also doubled the absentee owner surcharge starting from January this year.

There are also changes to the rules about building new homes in Victoria, which will add an estimated $40,000 to the cost of building the standard new home.

There’s also a windfall gains tax, which means that if you own land and it grows in value, you’ll be slugged with a major tax bill.

And if you’re brave enough to buy an investment property in Victoria, you’ll pay more in stamp duty.

State politicians have attempted to characterise these measures as “incentives” but they’re the opposite of that – they’re punishments.

So what are investors in Victoria doing? They’re selling up and getting out, in droves.

It means that the chronic rental shortage in Melbourne and other parts of the state is going to get immeasurably worse.

And it’s already serious.

We’re seeing single people in particular being squeezed out of the state’s rental market — and with social housing being inundated with growing demand — there are fears this cohort is being pushed closer to homelessness.

There are now close to 50,000 single-person households on the state’s social housing waitlist — representing 85% of all new applications.

A new report from the Community Housing Industry Association has revealed for every single person they house, Victoria’s social housing waitlist receives another two new applications from individuals.

It’s going to get worse in Victoria, as more and more investors sell up, and fewer and fewer new investors buy in, thereby further reducing the pool of homes available for rental.

And it’s all caused by the nation’s worst state government.

In contrast, in Perth and WA, the situation is likely to improve because investors there are being encouraged and incentivised, rather than treated as a criminal class as they are in Victoria.

Are you feeling overwhelmed by the complexities and uncertainties of the current mortgage market? Are you unsure about the best strategies for financing your dream home or investment property? We understand that navigating the mortgage market can be a daunting task, especially in today's rapidly changing economic environment. That's why we recently held a webinar called "Navigating the Mortgage Market in 2024: What Borrowers Need to Know" This informative session was hosted by two top experts in their respective fields, Tim Graham of Hotspotting, and Lucky Velasquez, the CEO of Finance Better. The webinar was held on the 7th of February at 1pm AEDT and covered everything you need to know to make informed decisions when it comes to mortgage financing. Lucky Velasquez, a highly experienced mortgage broker, shared his expert insights on how borrowers can secure the best mortgage deals and maximise their financial goals. During the webinar, you will gain valuable insights on: * The current state of the mortgage market and its impact on borrowers * Predictions and trends for the mortgage market in 2024 * Best practices for obtaining mortgage financing in the current economic climate * Insights on Self Employed & SMSF loan markets This webinar is a must-attend for home buyers, investors, and anyone seeking to understand the current and future state of the mortgage market.

One of the characteristics of Australians who get into real estate investment is that they tend to be herd animals.

They dive into property investment when they hear or read in news media that there is a boom happening – and so they want to be part of it.

This is where the FOMO syndrome – Fear Of Missing Out – plays a major role.

But people who behave in this way are the least likely to achieve success with property investment.

And it may help to explain why most Australians who attempt property investment never get beyond one or two properties – and less than 1% create a property portfolio of five or more.

Those who make it to the 1%, the ones who develop a portfolio and achieve financial success, are the ones who behave differently to the herd.

They understand that no one ever got rich in real estate by following the herd.

The smart investors are usually doing the opposite of the herd – or, at the very least, leading the herd.

Because by the time the herd starts to stampede, the boom is already well-advanced and the best time to buy has been missed.

The smart investors, the ones who make up the 1%, think and act independently.

They conduct property research and they access the best advice available. They spend money on advice, information and mentors before committing big money to a piece of real estate.

They’re usually well ahead of the pack, which will stampede when media reports a boom is happening – which is usually a year or more after the smart investors bought in the target location.

Lately I’ve become increasingly concerned at the behaviour of herd-following investors in the Perth market.

Investors are buying too quickly, paying far too much for poor real estate - and failing to conduct proper due diligence before signing contracts.

When houses are commonly selling within a week of being put on the market, and at prices well above the asking price, then you know that buyers have lost sight of sensible processes.

That’s what’s happening in Perth at the moment. Investors are buying anything they can get their hands on, paying more than the property’s value and failing to do basic due diligence like building and pest inspections.

Some of these investors will end up with dud properties with expensive problems and they will seriously regret their actions.

It’s a classic case of buy in haste and repent at leisure.

Don’t get me wrong: I’m not saying “Don’t buy Perth”.

I’m saying: “If you’re buying in Perth, do so with the same due diligence you would apply anywhere else.”

The reality is that the Perth market has been rising strongly for three years. Those buying with undue haste right now are buying with the attitude that they can buy any property in any location at any price and still make big money.

This is not sensible investing.

Perth is undoubtedly one of the nation’s leading markets on price growth but that doesn’t mean that you can jump into this market recklessly and buy anything you can get your hands on at any price.

You still need to choose your suburb well, based on sound research principles, and you still need to choose the individual property with appropriate care and attention.

This is where the resources provided by hotspotting.com.au can make a huge difference.

Our new Top 5 Perth and WA Hotspots report suggests locations with good credentials for ongoing capital growth and also some regional alternatives that we think are worth considering.

Anyone with a hotspotting Membership, including the most affordable, the Hotspotters membership, can access the website’s research portal where you can conduct thorough research on suburbs and also on individual properties.

The resources include valuation estimates for individual properties, so you can ensure you’re not paying too much for the home you’re considering.

It’s so important that, even in a frenzied boom, you buy the right property in the best location at a reasonable price.

I urge everyone to ensure that they’re making buying decisions in Perth – and elsewhere – based on thorough research and due diligence, not the FOMO syndrome.

One of the great strengths of Regional NSW is that it provides affordable lifestyle alternatives to the super expensive Sydney property market.

Regional NSW in many ways provides something for everyone: some of Australia’s largest and most important regional cities, attractive sea change towns, appealing hill change enclaves, industrial centres, strong multi-purpose inland cities, lifestyle regions – and price ranges to suit most budgets.

Another of the Regional NSW advantages is that its property markets are underpinned by one of the nation’s strongest economies – ranked No.2 in the January 2024 edition of State of the States published by CommSec.

Part of that growth state economy is a major program of big infrastructure developments, including the $31 billion Inland Rail Link which has been energising markets along the construction route over the past 2-3 years.

Against that backdrop, Regional NSW overall showed steady improvement throughout last year and ended 2023 with a solid market, although not as strong as Sydney’s.

The number of rising markets to be found in Regional NSW has increased recently, which means Regional NSW has started 2024 with good momentum in many locations.

NSW is a big state and there are many different scenarios in play, with markets that are rising strongly, some that are seeing moderate growth and others that are still struggling.

Some of the most high-profile NSW markets, like Byron Bay and the Central Coast, have not yet recovered from the correction phase in their property cycles, following the big uplift in 2020 and 2021.

But other precincts are doing much better.

The strongest market in Regional NSW is formed by the City of Wollongong and neighbouring LGAs Shoalhaven and Shellharbour.

Those three municipalities comprise a growth cluster on the coast south of Sydney, where most of the individual suburbs and towns have positive trends with sales activity and prices.

The Newcastle and Hunter region is steadily improving also, but is not yet as bullish as that Wollongong precinct.

There are nevertheless plenty of growth markets in Newcastle and the neighbouring Lake Macquarie LGA.

Other precincts with positive trends with their sales activity include the Tweed, Ballina, Coffs Harbour, Goulburn, Orange and Albury regions.

The Sydney market performed strongly in 2023, according to data from all the major research sources, and has started the New Year with considerable forward momentum.

PropTrack reports that the median house price for Greater Sydney rose around 8% in 2023, above its capital city average of 6.4%.

Domain has more bullish figures, with Sydney’s median house price rising 10.6% last year, while CoreLogic claimed that Sydney house prices lifted 12.5%, also above its national average of 8.6%.

While it’s confusing for consumers that different research entities have conflicting figures on median prices and how much they have changed, the common features from PropTrack, Domain and CoreLogic is that they all record a strong year for the Sydney house market.

In terms of the apartment market, all three major data sources have Sydney showing solid price increases close to their national average figures – 4.5% (PropTrack), 6.3% (Domain) and 7.7% (CoreLogic).

But the most relevant data, we think, is the trends with sales volumes, often a forward indicator of prices.

Hotspotting’s analysis for the quarterly editions of The Price Predictor Index found that the Greater Sydney market improved as 2023 evolved and finished the year strongly.

In our most recent analysis, 84% of suburbs had positive classifications, including 51% of suburbs which were ranked as rising markets.

That 51% rising result was the strongest in the nation and it means that Sydney has entered 2024 with lots of momentum.

Whichever way we look at the numbers, Sydney has a strong market, with rising buyer demand in sectors right across the Greater Sydney area, from the Sydney CBD to Penrith.

As we have noted in recent editions of The Price Predictor Index, there is rising buyer demand in locations with a high content of apartments.

The City of Sydney LGA is one of the busiest in the Greater Sydney Area. Of the 22 Sydney City suburbs in our latest quarterly analysis, 20 had positive classifications, including 15 rising markets.

Other precincts with a high component of attached dwellings also had strong markets, notably suburbs in the Inner West, Parramatta, Ryde, Canada Bay and Strathfield LGAs.

The Inner West LGA has 19 suburbs on our list of which 17 had positive rankings, including 15 rising markets, in our most recent analysis.

And there is strength in other sectors of the Greater Sydney market. It may be the most expensive of the nation’s city markets, but buyer demand remains strong and prices continue to rise.

There is impetus in inner-city markets with good demand for apartments; in middle-ring locations like the popular Canterbury-Bankstown precinct; and in outer-ring locations with more affordable prices like the municipalities of Liverpool, Blacktown and Penrith.

So Hotspotting expects Sydney to continue to deliver solid growth in 2024 – and to once again defy the economists who have started the year with their customary pessimistic forecasts.

When politicians create an inquiry or a royal commission to examine an important issue, you can be certain that nothing much is going to change.

An inquiry is a device used by politicians to give the appearance of doing something meaningful, while changing nothing.

So the Prime Minister’s plan to have an inquiry into supermarket chains like the thoroughly-dishonest Woolworths, which will take over a year, is a clear signal that there is a serious issue which the Federal Government has no idea how to deal with – and that nothing will change any time soon, if ever.

We’ve seen that with inquiries and royal commissions in the past into a range of issues, including aged care, the behaviour of banks and financial institutions, deaths in custody – and, in the real estate space, housing affordability and the rental shortage.

The most likely outcome of these massive wastes of time and taxpayers’ money is that the politicians involved will scapegoat a section of the community, blame them for the problem and hit them with punitive measures, to give the appearance of actually doing something.

And if they can use the situation to hit the chosen scapegoats with new or higher taxes, then so much the better.

This happened with Federal Parliament a decade ago with housing affordability. Two inquiries were held and it was decided to blame foreign investors for poor real estate affordability. The Federal government hit foreign buyers with massive new taxes and told the public they had fixed the affordability problem.

But can anyone say that housing affordability has improved since then?

Clearly, it hasn’t improved, it has continued to get worse, because foreign investors were never the problem.

What these measures did do was effectively wipe out foreign investment in Australian real estate, which is one of the key reasons why we now have a massive shortage of rental properties.

So now federal politicians have concluded an inquiry into the rental shortage crisis, with rapidly rising rents.

This happened in early December – and if you’re wondering why you haven’t heard anything about it, it’s because there was nothing to say.

What recommendations did the parliamentary committee deliver as a result of the inquiry?

None whatsoever.

The only outcome was that the chair of the committee, a Greens politician, repeated the party’s policy of having a rental freeze across the country.

All that time and energy wasted with no outcome at all – other than a reiteration of Greens policy by one committee member, which has no chance of ever being implemented because it’s a folly that would turn a crisis into a catastrophe.

Residential real estate abounds with myths and misconceptions, most of them perpetrated by politicians and others with a vested interest in having people believe something that’s not true.

The greatest fallacy of all is that property investors are a privileged class with massive tax and other advantages that distort the market and cause problems like poor affordability and the rental shortage.

In reality, the opposite is true.

Property investors are seriously disadvantaged and discouraged in so many ways,

that more and more of them have opted out of owning investment properties, which is why we have a chronic shortage of rental properties.

The fallacy about property investors having big tax advantages which should be disallowed was repeated recently by Everybody’s Home, a coalition of organisations which includes The Salvation Army and National Shelter, which proposed the rather horrifying scenario that everyone who rents would be living in social housing.

Under their proposition, private renting would no longer exist and the one-third of Australian households that rent would be living in social housing.

Given that 90% of the dwellings that people rent currently in Australia are provided by private mum and dad investors, this is a rather radical nation-changing quantum shift in the real estate landscape.

Everybody’s Home justifies this wacko idea by claiming that property investors are massively advantaged by negative gearing and a capital gains tax concession.

But the opposite is true. Relatively few property investors access negative gearing benefits

and there is NO capital gains tax concession – just a method of calculating capital gains tax

which is an impost paid only by investors, not by home owners.

Indeed, capital gains tax is one of many examples of ways in which property investors are quite seriously disadvantaged.

Investors pay taxes that home owners don’t pay, namely capital gains tax and also land tax, which increasingly is a major deterrent to investment.

Some states, such as Victoria, have introduced new taxes and charges to further alienate investors and make the rental shortage worse in that state.

Investors also pay higher interest rates than home buyers, although there’s no practical reason why that should be so. Investors also pay higher council rates than home owners and higher rates of insurance than home owners.

Indeed, the system is so loaded against property investors it’s miraculous that anyone would undertake is at all.

And, in fact, it’s that very long list of factors where property investors are disadvantaged

that has created the worst rental accommodation shortage in the nation’s history.

But if the disconnected individuals at Everybody’s Home have their way, it will become immeasurably worse. There will be no private rentals at all.

Everyone will be renting from the government or from international corporations.

Australian consumers can be forgiven for thinking that property price data published by research firms like PropTrack and CoreLogic is a matter of fact.

The median house price for a city, you might think, is a matter of fact and how much it has risen or fallen is a matter of fact.

Right? Well, actually, no.

Media reports these figures as if they are absolute fact - but they are not.

Like all real estate data, median prices are rubbery figures.

The median price for a city, and how much it has changed recently, depends on whose figures you believe.

All research businesses have their own methodology for calculating median prices – and the reality is that one research entity has different figures from the next one – so it can get very confusing.

The property website Domain has just published its figures on property prices up to the end of 2023 – and their numbers are starkly different from those published by CoreLogic – and reported by journalists as the gospel truth.

CoreLogic says the national market leader in 2023 was Perth, because its median house price rose 15.6% last year.

But Domain says Perth’s median house price rose 11.9% and wasn’t the national leader at all – that honour was given to Adelaide, where the median house price rose 12.7%, according to Domain.

CoreLogic says Brisbane was the No.2 performer on house price growth last year, with its median price rising 13.3% - but Domain disagrees. It says Brisbane increased only 9.7% - which is quite a substantial difference – and it ranks Brisbane behind Adelaide, Perth and Sydney on price growth last year.

Canberra fell 4.6%, according to Domain, but CoreLogic says it increased 1.0%.

And how much are those median house prices in each of the capital cities?

CoreLogic says the median house in Sydney costs $1.4 million, but Domain says it’s $1.595 million – that’s a difference of almost $200,000.

In Melbourne you pay $945,000 for the average house, if you believe CoreLogic, or $1.047 million if Domain is correct. The disparity there is over $100,000.

Domain says the median house price in capital city Australia now is over a million dollars - $1.094 million, but CoreLogic says $937,000 – a difference of $157,000.

There are also some stark disparities in the price data for apartments.

CoreLogic reported that Perth led the nation on growth in median unit prices, up 12.4% for the year, but Domain claims that Perth rose only 5.2% and was nowhere near the best in the nation, and was out-performed by four other cities.

CoreLogic says Canberra unit prices declined around 1% last year but Domain says they rose 10%, one of the best results in the nation.

How can anyone make sense of these really big differences in the views of two major research sources, who really don’t agree on anything when he comes to prices in our city markets and whether markets have risen or fallen, or by how much.

It’s important to understand that median price figures, like all real estate data, are rubbery figures – and always need to be treated with caution.

And, if you’re wondering where Hotspotting sources its price data, the answer is PropTrack, the research arm of the leading property website, realestate.com.au - which we think has the most reliable and up-to-date data available.

We use PropTrack for the data feed that populates the Research Portal which can be accessed by customers who have one of our memberships.

Tim Graham of Hotspotting.com.au was a guest on Corey Jones Motivate Property Podcast this week. They discussed the fascinating world of AI technology and its disruption within the real estate industry, along with some market predictions for 2024. For those looking for a great Buyers Agent in W.A. look no further than Corey Jones from Motivate Property and be sure to give his podcast a follow.

One of Australia’s leading experts in SDA Housing Investments, Danny Buxton of Triple Zero Property, recently joined Hotspotting founder Terry Ryder in a free webinar, and you can catch the replay here. About Triple Zero Property The team at Triple Zero Property are all homeowners and property investors, bringing a wealth of experience to the real estate industry. With over 50 years of combined experience, they have developed the expertise to streamline and maximise profitable property opportunities while minimising excessive time commitments. The team recognises the value of their clients' time and is dedicated to doing the research and legwork for them. Through their established networks and proven track record of independently finding properties that fit each client's profile, budget, and timeline, they are ready to assist in getting them started. Whether it is a client's first home purchase or they are a seasoned investor, the team is eager to help.

The Regional Victoria market continued to improve in 2023, following the lead from Melbourne, although not rising as dramatically as the capital city has recently.

As the year wore on, Regional Victoria built on the recovery evident in mid-year, with the number of rising locations almost doubling in the second half of 2023.

Two-thirds of locations have positive trends with their sales activity, which means buyer demand, although some locations have been slow to join the overall theme of revival and growth.

To put the Regional Victoria market into perspective, the 66% of locations with positive trends is a solid performance, but well short of Melbourne (87%), Brisbane (85%), Regional Queensland (76%) and Regional South Australia (74%).

Geelong continues to be a market leader in Victoria, with most of its suburbs on board with the state’s recovery, led by locations such Armstrong Creek and Charlemont.

Bendigo has an equally positive market, with strong buyer demand for affordable suburbs like Eaglehawk which has a median house price $515,000 – a price level that’s impossible to find in the Greater Melbourne area.

Ballarat is a little less bullish at this stage, but has been a very solid growth over the past five or so years.

The Cardinia LGA on the south-eastern fringe of Greater Melbourne has good momentum, led by the towns of Officer (median price $715,000) and Pakenham (median price $640,000).

The Mitchell LGA, on the northern outskirts of Greater Melbourne, continues to attract buyers from the capital city. All five of the main Mitchell Shire towns have positive trends, headed by Wallan and Seymour.

The Macedon Ranges LGA is also a solid performer, led by Kyneton, as is the Moorabool LGA headed by Darley and Bacchus Marsh.

The Latrobe Valley region east of Melbourne is characterised by consistent markets, including Moe (median price $365,000), and Newborough (median price $417,000) – again, with relative affordability a major attraction for home buyers and investors.

Other regional centres with good momentum include Wodonga, Wangaratta, Benalla, Bairnsdale, Paynesville, Drouin and Echuca.

Overall, the appeal of the Victoria market is that it provides affordable options in strong, growing regional cities like Bendigo, Geelong and Ballarat which are well connected to Melbourne by road and rail – as well as other options further afield like Shepparton, Mildura, Wodonga, Warrnambool and Traralgon.

Perth was undoubtedly the capital growth star of Australian real estate in 2023, with the highest increases in median prices both for houses and for apartments, slightly ahead of Brisbane in both categories.

Perth continues to be a busy market with good buyer demand – but we are now seeing the first signs of moderation in the three-year Perth property boom, as sales activity starts to taper off from the recent highs.

For the first time in three years, suburbs with negative classifications are almost as numerous as the positive ones. And in the latest quarterly edition of The Price Predictor Index, the market-share of Perth suburbs with positive rankings has dropped from 79% to 54%.

While the Perth market remains solid, it’s no longer a national leader in sales momentum – and right now some of the best options for investors in Western Australia are regional cities outside of Perth.

So our new Top 5 Perth and WA Hotspots report features some of the best prospects in Regional WA, as well as locations which continue to show buoyancy in Perth.

Some sectors of the Greater Perth market continue to attract good buyer demand, including the City of Perth LGA, which comprises the inner-city suburbs, reflecting a national trend where inner-city apartment markets in the major cities are attracting high buyer demand.

They include East Perth and West Perth, which both have median unit prices in the $400,000s.

Outer-ring markets offering affordability are still travelling well, including the City of Armadale and the City of Rockingham in the far south of Greater Perth.

Overall, there continue to be some good prospects for buyers in Perth, but you need to be more selective than before – and some of the best bets in WA are now in regional cities.

Melbourne has evolved from a struggling market to a boom one in the past 12 months and is now a national leader on growth momentum.

Almost half of the suburbs in Greater Melbourne are now classified by Hotspotting as rising markets and 87% of them have positive rankings in our Price Predictor Index.

This represents a massive transformation from the situation at the start of 2023. Our quarterly surveys show that the number of rising suburbs in Greater Melbourne has increased from 12 (9 months ago) to 58 (6 months ago) and now to 142 – with rising markets increasing from just 4% of suburbs a year ago to 47% now.

A year ago 67 suburbs in Greater Melbourne were categorised as declining markets; now there are none.

This return to a market characterised by high buyer demand is seen right across the Greater Melbourne area, with the exception of the Mornington Peninsula.

The City of Melbourne, which includes the Melbourne CBD and near-City suburbs, is thriving – but so too are Middle Melbourne precincts like the Whitehorse LGA and the Monash LGA, as well outer-ring areas such as the City of Casey in the far south-east, Wyndham in the far south-west, Melton in the far west and Whittlesea on the northern fringe of the Greater Melbourne area.

Earlier this year we identified the City of Melbourne as a national leader of an emerging trend of rising buyer demand for inner-city apartments.

This survey has confirmed the strength of this market: the 10 City of Melbourne suburbs in our analysis include nine rising markets and one recovering market.

The neighbouring City of Yarra also has busy markets.

The City of Whitehorse figures among the standout areas in the middle-ring areas. The 16 suburbs in our analysis include 10 rising suburbs, led by Box Hill; Mitcham; and Nunawading.

Other Middle Melbourne areas with strong markets include the LGAs of Banyule, Monash and Moonee Valley.

Many of the outer-ring municipalities are attracting high demand. All 15 suburbs in our City of Casey analysis have positive sales activity trends, including 10 classified as rising markets.

The City of Melton in the far west has 16 suburbs on our list and 15 of them have positive trends, including 9 rising markets.

It’s a similar story with the Wyndham LGA in the south-west and the City of Whittlesea in the north of Greater Melbourne.

Overall, Melbourne markets have transitioned into 2024 with good momentum – and we expect solid price growth in many markets as the year unfolds – certainly much better than the results of 2023.

A recent headline in the Australian Financial Review newspaper summed up why most of the property price forecasts published in mainstream media are hopelessly inaccurate.

The Fin Review headline declared “house price growth to slow as interest rates bite”, following a survey of economists by the newspaper.

Th survey of 30 economists came up with a median predicted rise in house prices nationwide of just 2.5%, with eight respondents forecasting a decline in property values.

The first error is that the Financial Review, which should know better, has sought expert property analysis from people who are not property specialists and certainly not experts on real estate matters.

The next mistake is the one that economists seem destined to make year after year – the belief that the biggest factor, indeed the only factor, which determines house price outcomes is interest rates.

The error is compounded by the belief that interest rates, which did not “bite” in 2023, would suddenly turn around and “bite” in 2024 - even though it’s likely that there will be no further rises by the Reserve Bank and the next movement in the official rate is likely to be downwards.

The inability of economists to understand that their methodology is flawed, and that they need to change, is quite remarkable.

Even more remarkable is the persistence with which newspapers seek real estate forecasts from people whose track records in predicting house prices is so bad it’s embarrassing

So the Financial Review would have us believe that property prices will be subdued because interest rates, which failed to impact throughout last year, will mysteriously impact in 2024.

Barrenjoey chief economist Jo Masters is tipping 4.8% growth nationally, but with Sydney house prices up just 3.8% and Melbourne up 3.2%.

Oxford Economics’ senior economist Maree Kilroy is tipping a 2.7% gain in 2024.

Jarden’s Carlos Cacho expects prices to rise 5% nationally.

Australian National University associate professor Ben Phillips expects a “sluggish 2024” for property prices, tipping 4% nationally, but only 3% for Sydney, Melbourne and Canberra.

But for truly misguided forecasting, there’s nowhere better to go than to AMP chief economist Shane Oliver.

Oliver, who has a long track record of inaccurate property forecasts, says he expects house prices to fall 3–5 per cent this year, but with rate cuts providing relief in the second half.

In other words, it’s all about interest rates, even though the results of 2023 proved that it isn’t.

Nicola Powell, chief of research and economics at property website Domain and therefore more of a property specialist than those institutional boffins, is more bullish and tips 6-8% increases in house prices.

Ray White chief economist Nerida Conisbee, also a property specialist, is also optimistic and expects price rises this year could exceed the gains of 2023, which averaged around 8%.

Conisbee says: “The main reason is that many of the drivers of price growth this year continue to be in place, particularly low levels of housing supply. In addition, it is increasingly looking like we will see a rate cut in the first half of 2024. This will further fuel pricing.”

The record shows that specialist real estate analysts are far more likely to get it right with their property price forecasts than economists working for the big banks and other institutions.

Fulltime real estate analysts have some claim to being experts, while economists do not – and the proof of that is in the results of recent years.

One of the key national trends we’re tracking at Hotspotting is the rise of apartments to challenge the dominance of houses as the dwelling of choice by most buyers.

Throughout 2023 we saw growing evidence of rising demand by a range of different buyer cohorts for affordable apartments in good locations.

This has led us to rank the inner-city precincts of Melbourne, Brisbane and Sydney among the leading hotspot markets in the nation.

The more we do our research, the more we find examples of locations where apartments are out-performing houses.

Not everywhere in Australia is producing these results but a rising number of suburbs ARE.

In the coastal market of Evans Head in regional NSW, the median price for houses has fallen 15% in the past year, but the median price for apartments has risen 14%.

The long-term capital growth average for houses in Evans Head is a healthy 9.5% per year over 10 years, but the growth average for apartments is considerably stronger, at 12.2% per year.

In the Wollongong suburb of Fairy Meadow, there were 46 house sales and 64 unit sales in the past year, with the median price for houses dropping 12% but the median price for units rising 16%. And of course units, with a median price in the $600,000s, are considerably more affordable than houses, with a median price above $1 million.

In iconic Byron Bay, prices overshot reasonable market levels during the Covid boom and have come back considerably since then.

The median house price dropped 25% in the past 12 months, down to $2.34 million. The median price for apartments also dropped, but down only 10% to $1.3 million, and there was a 2% increase in the latest quarter.

The long-term capital growth averages also show apartments performing better, averaging 10% growth per year, while houses have averaged 7% per year.

In another icon, Surfers Paradise, apartments are selling twice as fast as houses – and the median price for houses has dropped 5% in the past year but the median for apartments has increased 13%.

The long-term capital growth averages are a healthy 8.3% per year for houses and an even stronger 10.2% per year for apartments. And the rental yields are 2.8% for houses and 5.4% for apartments.

Price, once again, is a key factor – with median prices of $1.76 million for houses and $600,000 for apartments. Right now, apartments are typically selling in 28 days, with almost 1,500 unit sales in the past year.

At Coolum Beach on the Sunshine Coast in Queensland, both houses and apartments have excellent long-term growth averages, but apartments are better – 14.4% per year versus 13.1% per year.

Right now apartments are selling twice as fast as houses in that suburbs – 27 days for units and 54 days for houses, with relative affordability a key factor. The median prices are $1.3 million for houses and $780,000 for apartments, keeping in mind that many well-located apartments in this location have spectacular beach and ocean views.

Apartments are increasingly popular in Canberra, where the median price for houses is close to $1 million but the median for units is $590,000.

In the suburb of Chifley, the median price for houses dropped 12% in the past year to $1.06 million, while the median price for units rose 25% to $530,000, with relative affordability a driving factor.

The long-term capital growth averages are 7.1% per year for houses, and 11.7% per year for units.

Units currently are selling faster than houses in Chifley and the yields are better – 4.5% versus 3.6%.

In the Canberra suburb of Casey, houses are taking an average of 52 days to sell, but units only 34 days. The median price for houses has dropped 7% in the past year, while the unit median has risen 3%.

The long-term growth averages are 6.4% a year for houses and 8.6% a year for units.

And units have higher rental yields – 5.3% versus 4.1%.

There are many, many more similar examples to be found across the nation – providing growing evidence that one of the dominant paradigms in real estate (that houses do better than apartments) is being challenged.

One of the big trends of Australian real estate in 2023 was the ongoing emergence of apartments as a challenger to the dominance of houses as the dwelling of choice for more and more people.

This was one of the key findings of our surveys in 2023 for the quarterly editions of the Price Predictor Index, which confirmed the emergence of unit markets – and this trend took on greater force as the year progressed.

Suburbs where apartments dominate the dwelling mix are now among the most powerful markets in Australia – which makes our new Top 10 Apartment Hotspots report essential reading for investors seeking opportunities in 2024.

In the Summer edition of The Price Predictor Index, The National Top 100 list of Supercharged Suburbs included 24 in the Greater Sydney area, of which half were locations dominated by units.

Inner-city suburbs in Melbourne, Brisbane and Perth also featured prominently on this list,

while the National Top 10 Municipalities list included the City of Melbourne, the City of Sydney and the Brisbane-inner precinct – as well as Gold Coast City, where a sizeable proportion of buyer demand is directed towards apartments.

The dominant paradigm of real estate (that houses on land show superior capital growth to units) is being challenged, as a growing number of important cohorts push demand for apartments higher.

Those seeking out well-located and affordable apartments include older people downsizing from a large family home.

They also include …

young people seeking an affordable first step on the property ladder;
lifestyle buyers seeking low-maintenance, lock-up-and-leave options in good locations;
overseas migrants from countries where unit-style living is the norm; and
investors seeking affordability and higher rental yields in good locations.

In inner-city precincts in our biggest cities, houses can typically cost over $2 million, but apartments can be bought in the $600,000s and $700,000s in the same suburbs in many cases.

The rental yields are also significantly higher, a key consideration in times of higher interest rates – although it needs to be remembered that apartments do entail additional costs like body corporate fees.

So there is a significant list of good reasons why apartments are attracting growing demand from a range of buyers and capital growth rates are improving.

This makes our new National Top 10 Apartment Hotspots report a document of increasing importance for property investors.

The key word in real estate is shortage.

It was the key factor in the property price rises we have seen in the past year, in the face of multiple increases in interest rates.

And it’s going to get worse before we see any improvement.

Australia continues to build far too few new dwellings – and the forecast for 2024 is grim, from the viewpoint of addressing the shortages that are helping to drive up property prices and rents.

It’s predicted that home building will occur in 2024 at the slowest pace in more than a decade.

The Federal Government has set a goal to build 1.2 million new homes over the five years from 2024 – an average of 240,000 new homes each year – which is a rate of construction that has never before been achieved in Australia.

Currently the industry is falling well short of that target – and is likely to continue to do so, given that the building industry is blighted by shortages of everything, rising costs and building companies going broke week by week.

Investment and advisory group Jarden Australia says the government goal of 1.2 million homes is looking increasingly unlikely.

Jarden economist Carlos Cacho says: “Despite housing prices picking up again and despite the chronic undersupply of housing, we haven’t seen a pick-up in sales. On our numbers, we expect housing starts in calendar year 2024 to slow to about 155,000, which would be the lowest since 2012.”

So we need to build 240,000 to meet the Federal Government’s fanciful target, but the outcome his year is likely to be 155,000 new homes.

The higher cost of materials, land and finance are making it harder for developers to build dwellings profitably.

Jarden says Australia’s housing shortfall, expected to be at least 175,000 homes by 2027, reflects the failure to meet the key drivers of demand including smaller household sizes and the recent uplift in migration.

Extreme labour shortages have added to construction costs, delaying projects despite growing demand under-pinned by record-low vacancy rates and strong population growth.

The outcome is that we are likely to see sale prices and residential rents continuing to rise across Australia.

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Media misinformation is the scourge of real estate consumers everywhere.

And nowhere is the problem of rubbish in newspapers and other media more vivid than when they publish lists of the top suburbs for real estate performers across Australia.

Invariably, these lists are bogus because they’re made up of locations that make the list because of statistical aberrations.

Journalists love their lists – they’re a really easy headline, like “The Top 20 places for capital growth in 2023” – and they either don’t know or don’t care that the locations on the list are there because of “lies, damned lies and statistics”.

The research companies like PropTrack and CoreLogic are happy to provide these lists because it’s easy publicity and so they ask their computers to spit out a list and send it off to the media.

With computers, even in this era of AI, it’s a case of garbage in, garbage out. And if you don’t clean up the list your computer throws up, by checking for statistical oddities and aberrations usually caused by small sales samples, then the list will be rubbish.

But they don’t care as long as it achieves free publicity.

Recently the Newscorp network – which publishes The Australian, the Herald Sun, the Daily Telegraph and the Courier-Mail in Brisbane - published one of these lists under the headline “Queensland dominates nation’s top suburbs for buyers”.

This purported to be a list of the top 10 suburbs in Australia for buyer demand, based on what the statistics say.

Here’s the problem. If a location is a small town or suburb, or a new suburb, and there are very few sales in the year, then the median price data and the capital growth figures will be unreliable.

Indeed, often an absolute nonsense.

For example, you can’t have a credible median price in a location with only 8 or 10 sales in the year. A few sales at the bottom end of the market or at the top end of the scale will greatly distort the figures.

Ethical researchers know this and would never publish data on places with fewer than, say, 30 sales in the past year because the figures will be distorted and unreliable.

But, as I said, neither the research companies nor the journalists give a damn – as long as it creates a clickbait headline.

I’ve had instances where I’ve explained to journalists who called about their list before publishing it, that the locations were bogus and it would be embarrassing to them professionally to publish nonsense – but they’re gone ahead the printed the list and the article anyway.

As I said, they just don’t care that what they’re presenting to you, the consumer, is rubbish.

So that recent top 10 list of the nation’s top places for buyers? How many of the 10 locations had fewer than 30 sales in the past year?

The answer is that 9 of the 10 had sales samples too small to be considered valid entries.

That’s why most of the locations on this top 10 national list of great places to buy are places that most of us have never heard of.

What would you think if I told you that the best places in Australia to buy were Catai, Matcham, Sheldon, Woronora, Chandler and Holgate.

Where? I hear you say.

Some of these places are so small and insignificant that they recorded only 10 or 12 house sales in the entire year.

They say that “if you torture statistics enough, they’ll tell you anything you want to hear” – and that’s certainly true in this instance.

If you don’t care about accuracy or credibility or about helping people, then you’ll be happy to use bogus statistics to tell a story that simply isn’t true.

It’s a stark example of “reader beware”, ahead of “buyer beware”.

A number of commentators and analysts have labelled 2023 as an “extraordinary” year in real estate.

One called 2023 “the year that surprised everyone”.

Who are these people? They’re the economists (like the ones who work for the big banks and for organisations like CoreLogic and AMP Capital) who got it wrong with their forecasts on what property prices would do this year.

And rather than admit their mistake – and indeed their ongoing incompetence in this area – they have tried to write it off as an aberration, an outlier, a year that nobody expected.

And in that regard the economists are wrong, yet again.

Many of the specialist real estate analysts – like the team at Hotspotting – DID foresee the year that occurred in 2023 and correctly predicted that we would see moderate to strong price growth in most, but not all, markets across Australia.

The year that unfolded was pretty much exactly what Hotspotting forecast at the start of 2023.

Our broadcasts and writings in late 2022 and early 2023 predicted a year of price growth, but not a boom year.

One example was the annual real estate featured published by Money Magazine in February each year, written by Hotspotting managing director Terry Ryder.

Here’s what I wrote in that feature at the start of 2023:

No one is forecasting rises like we saw in 2021, when the national average was an increase above 25%. Rather, most analysts are suggesting moderate growth. That’s certainly how we see it at Hotspotting.

The failed forecasters working for the big banks, CoreLogic and elsewhere got it wrong and told us prices would fall at least 15% - because they fundamentally do not understand residential real estate.

They believe interest rates are the over-riding factor.

Here’s what the economists at CoreLogic wrote recently: “It’s pretty extraordinary to see values get to a new record high despite further uplifts in the rate-hiking cycle.”

The reality is that there was nothing surprising or extraordinary about the results of 2023.

Real estate showed its usual resilience because there were bigger factors in play than interest rates, notably an oversupply of demand and an undersupply of properties for sale and for rent.

It’s not rocket science. You could teach this to primary school children – but I seriously doubt you could ever teach it to an economist.

Overseas migrants coming into Australia have NOT caused the rental shortage crisis, as some have claimed, but they are certainly adding to the problem.

The latest population data from the ABS suggests Australia in FY2023 experienced its biggest one-year jump in population, fuelled by a record 518,100 new migrants calling the country home.

And that has prompted warnings that the nation’s rental market will remain under pressure for years.

The population swelled by 624,100 in 2022-23 – that’s around 1,700 people a day - with 80 per cent of the extra residents occurring in the eastern states – despite the fact the WA had the highest percentage growth during the year.

According to the ABS, Victoria’s population grew 181,000 to 6.8 million, while NSW added 172,600 to 8.3 million.

Most migrants to Australia moved to four states: NSW took in 174,000, Victoria added 154,000, Queensland gained 84,000 while WA accepted 61,600.

The ABS noted temporary visa holders such as international students were the main contributor to the high net migration level.

Migration accounted for 83 per cent of total population growth through the year as natural increase – births minus deaths – continued to fall, with the short-lived COVID-19 baby boom well and truly over.

WA had the highest percentage growth, up 3.1%, followed by Victoria 2.7% and Queensland 2.6%.

Those with growth well below that 2.4% national average were Tasmania (up just 0.3%) and the Northern Territory (up 0.9%).

The Federal Government says it is overhauling its migration strategy to address key skills shortages across the economy, while at the same time reducing the number of temporary workers in the country to ease population and housing pressures.

The rental shortage crisis has been building steadily for the past eight years and has not been caused by this recent upsurge in migration.

But high levels of new residents from overseas are certainly adding to the problem, for which the nation’s politicians have no solutions – although the remedies are starkly obvious.

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The new Summer edition of The Price Predictor Index shows that residential real estate in 2023 has defied the dire predictions of economists and commentators who told us that house prices would drop at least 15% because interest rates were rising.

Sales activity and prices have become stronger as the year has evolved. Our analysis shows that markets throughout the nation are overwhelmingly upbeat: 71% of suburbs have positive sales activity trends, led by the 31% of locations which we classify as rising markets and the 26% which are recovering markets. Only 4% of suburbs are ranked as declining markets.

There are numerous municipalities nationwide where virtually every suburb has a positive (rising, recovering or consistency) ranking in our analysis of sales activity trends and many outstanding precincts failed to make our National Top 10 Municipalities list because there were so many worthy candidates.

The rise of the three biggest cities, described in our Spring edition three months ago, has gathered further impetus.

Melbourne, Brisbane and Sydney all have 84-87% of their suburbs with positive momentum in their markets, a dramatic turnaround since the start of calendar 2023.

But next in the national rankings are Regional Queensland, Regional South Australia, Regional WA and Regional Victoria, indicating that markets outside of the capital cities continue to deliver growth. Overall, there is more powerful momentum in the cities than the regions. Seven of our National Top 10 Municipalities are capital city precincts - and 72 of the National Top 100 Supercharged Suburbs are located in capital cities.

Sydney is stronger than Regional NSW at present, Melbourne is outpointing Regional Victoria and Brisbane is (slightly) ahead of Regional Queensland.

The dominant trend in 2023 has been recovery, initially, and then strong upward trajectories with sales volumes - but not everywhere is on board with the resurgence.

As Sydney, Melbourne, Brisbane and several regional markets move into overdrive, Canberra and Darwin are stuck in neutral and Perth - after being a nation-leading growth market for three years - is now in reverse.

The Perth market is showing the first signs of fading and has lost its position as a national growth leader (although it will take time before it shows up in the price data).

The Canberra market is the weakest we have recorded in the eight years of these quarterly surveys and the Darwin market has little energy (CommSec in the State of the States report ranks the ACT and the Northern Territory as the nation’s weakest economies).

This confirms that property markets are local in nature and it’s rare to see all markets moving in the same direction and at the same speed.

Currently, the top 5 markets (Melbourne, Brisbane, Sydney, Regional Queensland and Regional SA) are very strong and the bottom 3 (Canberra, Darwin and Regional Tasmania) are rather weak.

One of the key findings of our surveys in 2023 has been the emergence of unit markets and this trend has taken on greater force as the year has progressed. Suburbs where apartments dominate the dwelling mix are among the most powerful markets in Australia.

The National Top 100 list of Supercharged Suburbs includes 24 in Greater Sydney, of which half are locations dominated by units.

Inner-city suburbs in Melbourne, Brisbane and Perth also feature prominently on this list, while the National Top 10 Municipalities list includes the City of Melbourne, the City of Sydney and the Brisbane- inner precinct - as well as Gold Coast City, where a sizeable proportion of buyer demand is directed towards apartments.

The dominant paradigm of real estate (that houses on land show superior capital growth to apartments ) is being challenged.

While recovery, revival and resurgence are the dominant themes of Australian property markets, there are (as always) notable exceptions.

The most striking absentees from the lists of market jurisdictions where sales activity is strong are some of Australia’s most iconic Sea Change locations: Byron Bay, the Sunshine Coast, the Mornington Peninsula and the Central Coast.

The common feature of those four locations is that they experienced extraordinary uplift during the so- called Covid Boom and indeed overshot realistic market values in some cases.

The median price for Byron Bay more than doubled in three years, upmarket Sunshine Coast suburbs like Sunshine Beach achieved similar astronomical growth, while the Mornington Peninsula was the Victorian equivalent.

It’s significant that while the upsurge across Greater Melbourne has been felt in almost every market sector, the Mornington Peninsula is a stark exception.

The Gold Coast is again a growth market but the Sunshine Coast is lagging. These places are having longer and deeper corrections than other parts of the country.

So those are the highlights – but’s there’s so much more in the Summer 2023-24 edition of The Price Predictor Index.

It provides a ranking for every major suburb and town in Australia and alerts you to the markets that are likely to show good price growth – and warns you of the ones to avoid.

It’s justifiably one of our most popular reports and not to be missed by anyone wanting to plan a real estate move in 2024.

Australian politicians are notable for their arrogance and the degree to which they are out of touch with the concerns and problems of ordinary citizens.

But if there’s a cohort that’s even more so, it’s powerful bureaucrats.

There’s an extra layer of disdain and arrogance with bureaucrats like the boffins at the Reserve Bank or the Australian Taxation Office, because they’re not accountable to the Australian people.

They’re appointed rather than elected, and they can enjoy exercising the power they hav eover people’s lives without fear of being turfed out at the next election.

The RBA can make big decisions that have huge impacts on families all over Australia without having to explain themselves or face the wrath of the electorate.

And so they do.

As I have commented previously, most of the members of the Reserve Bank board are wealthy elites, people who typically earn over a million dollars a year.

They spend most of their time in their ivory tower offices or luxury homes, and spend zero percent of time speaking to people at street level.

If they ever get out and about, it’s usually to speak at a business lunch where they can rub shoulders with other wealthy elites.

When Philip Lowe ended his reign of terror as Governor of the Reserve Bank, I celebrated because I saw him as a particularly blinkered individual who frequently lectured the nation that he knew what was best for us …

… and that we shouldn’t complain that he’s nonchalantly added over $1,000 a month to the living costs of ordinary families, without achieving the end game – which was to tame inflation.

Imagine my surprise and alarm to discover that the new RBA Governor is even more arrogant and out of touch than Philip Lowe.

Michele Bullock, who could have a future career an undertaker or possibly an executioner, has made a number of public pronouncements that indicate she doesn’t give a toss about the lives of families with mortgages.

According to the RBA’s new Grim Reaper, Australian households are doing just fine.

“Households and businesses are actually in a pretty good position,” she announced recently.

How has she arrived at this stunning conclusion, because we know she hasn’t been going door to door to speak to people?

My best guess is that she’s looked at some graphs on a computer screen, which is what economists tend to do before making inaccurate predictions about the housing market and other pronouncements that leave many Australians shaking their heads.

There are lots of negative forecasts in news media about property prices in 2024, but if you own real estate or are planning to get into the market, do not be alarmed.

At this time EVERY year, media is awash for pessimistic forecasts for real estate prices.

And most of the time they are proven wrong by subsequent outcomes.

Remember when Covid struck early in 2020? Media reports abounded with forecasts that house prices would collapse.

But they didn’t – prices rose in 2020.

At the start of 2021, most forecasters agreed prices would rise that year, but only 5 or 6 percent. But by the end of the year, house prices had appreciated by an average of 25%.

At the beginning of 2023, we were told by bank economists and media commentators that prices would drop at least 15% – because interest rates were rising.

And yet again, they were not only wrong, but spectacularly wrong. Prices have grown in most markets across Australia, including price rises above 10% in some cities.

So, as we head in 2024, the usual suspects are popping up with their price forecasts – and, you guessed it, they’re mostly pessimistic.

And news media is happy to publish them, despite the dreadful track record of so many of the forecasters.

Essentially, journalists don’t care about the credibility (or lack of it) of the commentators – anyone willing to stand up and declare that prices will collapse, or plummet, or nosedive, or fall off a cliff, is guaranteed lots of free publicity.

Which is why the people putting out press releases usually make NEGATIVE forecasts with dire warnings about real estate matters – they know a screaming negative is the shortcut to a high media profile, content in the knowledge that no journalist in Australia will ever challenge them about getting it wrong all the time.

An example of the mindset of the average journalist, and how it translates into misinformation for Australian consumers, is provided by media reaction to the Boom and

Bust report published in November each year by experienced analyst Louis Christopher of SQM Research.

Each year, this report presents four different scenarios to forecast what might happen with house prices in the coming year.

Each scenario assumes different outcomes with interest rates, inflation and unemployment, with various price predictions for each different scenario.

Journalists, being the sad, pathetic creatures that they are, will always zero in on the most negative of the four scenarios, and make that their story.

So headlines have been screaming that prices will fall in 2024 in the big cities.

It’s worth noting that the Boom and Bust report a year ago had fairly pessimistic forecasts for Australian property prices – with prices tipped to fall everywhere except Perth in the worst- case scenario – but prices have been rising steadily in 2023.

The senior economists at ANZ Bank, arguably the worst real estate forecasters in the nation, recently popped up with a report described a “triple whammy” of factors that will drag down property markets in 2024.

Journalists and bank economists have a number of things in common – they’re pessimistic by nature, they’re not very good at their jobs, they’re slow learners and they’re not interested in helping people.

They just want to generate headlines.

So if you’re a property investor, and you have a plan, tune out all the media white noise and just get on with it.

The Greater Brisbane market has gone to another level with its recent recovery, following a major surge in the number of suburbs with positive rankings.

We’ve just completed our latest quarterly survey of sales activity for Brisbane and it reveals that there are now 83 suburbs ranked as rising markets, compared with 38 three months ago and just 12 six months ago.

It’s the highest number since mid-2022.

This represents a notable turnaround from the situation recorded in our Winter 2023 survey six months ago.

Now 36% of suburbs are rising markets (compared with just 5% six months ago) and 85% overall have positive rankings (compared with 21% six months ago).

Six months ago in our Winter 2023 survey we commented that, then, it was the worst Brisbane market we have recorded in the eight years of our quarterly surveys of sales activity.

But the Spring 2023 survey three months ago recorded the start of a major revival.

And now our new quarterly survey shows further uplift in the Brisbane market.

Now 85% of Greater Brisbane suburbs have positive rankings and the number of suburbs with negative assessments has dropped in six months from 181 to just 34.

There are now no suburbs classified as declining markets, compared with 71 declining suburbs six months ago.

This is a truly dramatic turnaround in the Brisbane market.

All sectors of the Greater Brisbane market are performing, with the Brisbane-inner precinct emerging increasingly as a leader. All but two of the 23 suburbs in our survey have positive classifications, including 11 ranked as rising markets.

This reflects a trend evident in all the major cities of Australia, with more buyers opting for apartments in inner-city locations.

The Brisbane-north precinct is pumping strongly: 35 of the 41 suburbs in our analysis have positive rankings, including 20 rising suburbs – suburbs such as Brighton; Bridgeman Downs; Nundah; and Wavell Heights.

Neighbouring Moreton Bay region is equally busy: 36 of the 41 suburbs have positive classifications, including 15 rising suburbs.

The Brisbane-east precinct has some notable examples of the revival trend, including Bulimba; Cannon Hill; and Manly West.

Overall, 15 of the 20 Brisbane-east precinct suburbs have positive numbers.

This trend is repeated throughout all the sectors of the Greater Brisbane market, including Logan City in the south, Ipswich City in the south-west and Redland City in the south-east.

Overall, the results depict a Brisbane market which has recovered emphatically from the previous downturn and which now presents as a booming market.

There has been dramatic surge in buyer activity in Regional Queensland, converting the recovery we recorded three months ago into a potential boom market.

The number of locations with rising markets has increased significantly, while locations with negative trends have decreased.

Three months ago in the Spring 2023 edition of the Price Predictor Index we commented that

Regional Queensland had emphatically joined the comeback theme which dominated national property markets, recovering from the bottom of the trough experienced earlier in the year.

Our Spring 2023 survey revealed a dramatic turnaround of the rapid downward slide which marked the previous 12 months.

Since then, Regional Queensland markets have gone to the next level, with previous recovering markets converting into rising ones, and locations which were previously plateau or declining markets transforming into recovering ones.

Now, 76% of Regional Queensland locations have positive classifications (rising, consistency or recovering), compared with 67% three months ago and just 32% six months ago.

The number of rising markets has increased from just 16 in the Winter 2023 survey to 37 in the Spring 2023 survey and now 93 in this new Summer 2023-24 survey.

Some of the key Regional Queensland centres are now booming markets, while others are in the recovery phase and heading in that direction. Very few have yet to get on board with the trend of positive markets, with just 13 locations across Regional Queensland classified as declining markets, compared with 86 in our Winter 2023 survey six months ago.

The Gold Coast is at the forefront of the Regional Queensland revival: of the 49 suburbs in our analysis, 46 have positive classifications, including 23 which are ranked as rising markets.

The Sunshine Coast market is on the recovery path but less advanced than the Gold Coast. Of the 46 Sunshine Coast locations in our analysis, 32 have positive classifications, but as yet only 11 are ranked as rising markets, while 18 are recovering. There remain 13 locations with negative classifications, compared with only three on the Gold Coast.

Other regional cities which are well advanced in the return to growth markets include Cairns (20 of 28 suburbs have positive rankings) and Gladstone (12 of 14 are positive).

Key regional centres which are heading towards growth but are dominated at this stage by recovering suburbs include Mackay, Bundaberg, Fraser Coast and Townsville.

Rockhampton remains patchy, though largely positive.

Toowoomba has been a national standout in the past couple of years, but may be moderating: 10 of its 25 locations now have negative classifications. A resurgence is likely when major new infrastructure projects get under way.

Anyone who wants to understand why we have a shortage of housing, with rising prices and in particular rising rents, should make a study of the state of Victoria.

While all states and territories have contributed to the discouragement of new home building and especially to investors who provide the bulk of the rental housing, nowhere has been more prolific and emphatic in telling investors to stay away than Victoria.

Dictator Daniel Andrews was in a class of his own when it comes to discouragement investment in housing – and, having created a mess including a state debt crisis and the international embarrassment of cancelling the Commonwealth Games, he quit in September and left it to others to sort out the debacle.

The evidence so far is that the new regime is intent on making a bad situation worse.

Columnist in The Australian James Kirby noted in an article on 7 November the series of taxation hits taken by property investors in Victoria recently.

Kirby wrote:

The Victorian government kicked off the property tax changes in its budget in May, and then widened the tax net to include more investors when a vacant residential land tax was extended beyond the inner city to include the entire state. The tax will impact investors and holiday-home-owners from next January.

In recent times the Victorian government has also introduced a windfall gains tax for property developers and doubled the tax on absentee buyers from 2 per cent to 4 per cent, along with hitting the short-term rental market with a tax of 7.5 per cent on annual revenue.

Kirby quoted Irina Tan of Pitcher Partners: “It is no exaggeration to describe the proposed changes to Victoria’s land tax regime as a seismic shift in the way the system currently operates, that will impact anyone who buys or sells land.”

But it is the unexpected expansion of the vacant land tax that appears to have triggered widespread frustration across the property sector.

Under the terms of the plan, all owners of a second property beyond the family home in Victoria will face a tax of $975 plus 0.1 per cent.

The tax must be paid unless the owner has lived in the property for a minimum of four weeks each year or leased the house for at least six months.

Here are some of details which have turned investors, builders and developers away from Victoria:-

Long lead-up times for new homes:

Construction times for all types of homes in Victoria have blown out massively in recent years.

Victorians looking to build an apartment can expect to wait more than two years before they can actually move in, with the average time from planning approval to completion blowing out to almost 30 months - in other words, two and a half years.

Those building new townhouses will be forced wait more than 15 months before they can shift in furniture, while Victorians building freestanding houses will typically wait almost 11 months.

Denita Wawn of Master Builders Australia says the delivery of new homes has “been obstructed by the combination of labour shortages and broken supply chains, on top of planning delays, insufficient land release and red tape.

She says: “These unnecessary delays to construction ultimately drive up the cost of building.”

New vacancy tax:

Holiday homes across Victoria will be hit by the state government’s new vacancy tax, despite earlier assurances from the State Treasurer Tim Pallas that they are exempt.

The property industry was left reeling by the new Allan Government’s surprise plans to change the Windfall Gains Tax, the Land Tax Act and the vacancy tax, revealed in October just two weeks after striking a housing partnership with the sector.

The vacancy tax currently applies only to houses in Melbourne’s inner and middle-ring suburbs that have been unoccupied for more than six months, but will expand to include the whole state from January 2025.

One of the big forces behind this change is the Greens, who seem to regard real estate ownership as a criminal activity and to believe it’s okay to force people to do things with their properties that they don’t want to do. And they also want to rent controls.

So they want to force people to allow strangers to live in their properties and then dictate how much rent they can charge.

New tax on Airbnb properties:

In September the State Government announced a new tax on property owners who use short-term letting systems like Airbnb. The tax will be 7.5% of annual revenue.

According to the Opposition, this was the 50th new or increased tax by the Labor State Government since coming to power in 2014.

Independent analysis shows Victoria is by far the highest-taxing state in the nation.

More infrastructure levies:

More developers would be slugged with a levy to help pay for local infrastructure under a plan the State Government is considering.

But the industry says the plan to worsen housing affordability, arguing more developers could be forced to pass on the costs of the Growth Areas Infrastructure Contribution to consumers at a time of high interest rates, expensive building materials and key worker shortages.

The one-off charge currently applies to developments in seven local government areas around Melbourne’s fringe: Cardinia, Casey, Hume, Melton, Mitchell, Whittlesea and Wyndham.

But the State Government plans to broad the levy to include all of Melbourne or even the entire state to fund incoming housing reforms.

Growing state debt:

Why is the State Government of Victoria slugging the housing industry with new or increased taxes?

Because Victoria is drowning in debt thanks to nine years of financial mismanagement by the Daniel Andrews Government.

Victoria is sitting on debt totalling about $120 billion, making it the nation’s most indebted state:

According to independent economist Saul Eslake. the increase in debt has been driven by the government’s decision to “embark on very big, largely debt-funded infrastructure spending programs”.

In August, Moody’s projected that Victoria’s debt would reach $226 billion by 2026, endangering the state’s credit rating, which is already the lowest in the country.

According to Moody’s, Victoria’s debt will have increased by 85% in five years.

It hasn’t been helped by a massive blowout in construction costs for infrastructure projects.

In 2016, the North East Link was to cost $10 billion. Its price tag is now $16.5 billion.

The West Gate Tunnel ballooned from $5.5 billion to $10 billion. The Metro Tunnel’s 2015 business case said it would cost $7.5 billion, but it will cost $12 billion. And the Suburban Rail Loop was to cost $50 billion. Its first stage, covering a third of the total plan, is budgeted at $34.5 billion.

Investors are selling:

Analysis in August by PropTrack found that Victorian landlords evicting themselves from the state’s property market – and have racked up the highest share of home sales since 2018.

PropTrack figures show about 29% of sales across the state in June were landlords getting out, while the state’s biggest real estate agency has revealed the Melbourne exodus is so extreme that less than half the homes sold by investors are being replaced by new investments.

The Real Institute Of Victoria reports that one in four Melbourne rental providers have sold their properties over the past 12 months.

Quentin Kilian, the CEO of the Real Estate Institute of Victoria, said:

“Investors are fleeing and looking at other states. Each time a new tax or a new regulation is introduced it beats confidence out of one of the state’s most important economic contributors,” he said.

Two years ago, Melbourne’s vacancy rate was 3.5%, the highest among the capital cities.

Now it’s just 1.2% and falling steadily. And that means higher rents for tenants.

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We elect politicians to fix problems and make people’s lives better.

But increasingly our elected representatives are doing the opposite.

They’re creating new problems, exacerbating existing ones and failing to find solutions to any of the pressing issues.

The biggest issues facing most Australian households right now – according to the surveys - are the cost of living and rising accommodation costs.

Soaring prices for petrol, electricity and food are a major burden for many families and the shortage of homes, a problem created by politicians, is getting worse – thereby pushing up property prices and residential rents.

The Federal Government has taken no effective action to deal with these core problems. There’s a lot they could do to deal with petrol prices, power prices and the shortage of housing, but they’ve thrown up their hands and essentially told us is out of their hands.

They’re leaving it to the Reserve Bank to solve inflation by putting up interest rates – a move which has added to inflationary pressures in many key areas, including residential rents.

And now we have analysis from the International Monetary Fund, which has concluded that the spending boom on infrastructure by governments across Australia is one of the biggest contributors to high inflation.

The IMF says the unusually high level of government spending on infrastructure has helped push the nation’s economy beyond full capacity, which has forced the Reserve Bank to lift interest rates further to tame inflation.

In effect, Australian mortgage holders are being forced to bear the consequences of higher interest rates because government spending has over-expanded and is heating up demand that the Reserve Bank is trying to hose down.

It’s bizarre, isn’t it? Politicians have made serious errors of judgment which have caused high inflation and the Reserve Bank’s response is to punish the one-third of Australian households which have mortgages.

Are we on the cusp of another substantial rise in real estate values?

One of Australia’s best real estate analysts believes we are.

Simon Pressley, head of research at Propertyology and one of the best property market analysts in the nation, says Australia is just weeks away from the start of what he calls “an intense surge in housing values”.

Before I describe his rationale, let me say that Simon Pressley is right with his forecasts more often than most in Australia – and is infinitely more credible than any of the major bank economists who constantly get it wrong with their house price predictions.

Pressley says “the evidence is pointing to a window which is likely to produce capital growth rates that are rarely seen”.

He says the evidence says Australian property markets are already booming – prices up 8% in the first 10 months of 2023 – but he suggests that the rate of growth in real estate values is about to accelerate even more.

He says: “A logical and objective assessment of a collection of evidence suggests that the quarter starting on 1 January is likely to produce a rate of growth which is rarely seen.”

He says that capital growth around 20% on an annualised basis is not out of the question in some locations.

Here’s the rationale:- 1. The data shows that growth rates are accelerating already. 2. We still have a very low volume of properties listed for sale – indeed 27% lower than at the same time five years ago, when the population was 1.5 million less than now. 3. In coming months, supply volumes will reduce by a further 10% or so, because we’re coming into the Christmas/New Year period. 4. Buyers have more confidence heading into the start of 2024 and many will buy early in the New Year. 5. Interest rates are expected are begin falling early in 2024. 6. Then there is the ongoing influx of overseas migrants in record numbers 7. All this will put upward pressure on property prices

Pressley also observes than even the bears are bullish, noting that the major banks are now forecasting solid price rises in 2024.

And I have to say I agree with most of the points he makes. His logic is sound and it confirms our thinking at Hotspotting.

Many of the underlying points are also supported by a recent report published by PropTrack. Here’s what PropTrack says ...

The 2023 price upturn is firmly entrenched with home prices hitting fresh record highs in many markets in October.

PropTrack says price growth has clearly accelerated since 2022. Capital city markets have led the price upturn in 2023 while regional areas have had slower growth. But he pace of growth in regional markets has begun to increase after lagging much of this year and in October, regional prices rose further to set a fresh record high. Price growth has accelerated right around the country relative to earlier in the year, with the exception of regional SA and NT. So, the overall picture is one where property prices have been rising since the start of 2023, the rate of growth is picking up – and the pace of price rises is expected to go to another level early in the New Year.

We know that renting can be bad for your financial health, but a new study has revealed that renting is also bad for your physical wellbeing.

According to the study, people who rent age faster than people who own their homes.

It also indicates that renting is worse for your health than smoking and unemployment.

The study was conducted jointly by the University of Adelaide and the University of Essex in the UK and took a sample of 1,420 adults – comparing the impact of various housing elements such as ownership status, building type, location and heating on the ageing process.

Biological ageing, the cumulative damage to body tissue and cells that occurs regardless of chronological age, was found to occur more quickly among those who rent.

Why? According to the researchers, the stresses of housing insecurity and unaffordability are the most likely factors driving this link.

Lead researcher Dr Amy Clair from the University of Adelaide said: “Housing circumstances have a significant impact on biological ageing, even more so than other important social determinants, such as unemployment.”

She concluded that “it is therefore likely that private renters in Australia might experience accelerated biological ageing” as long as the rental crisis continues.

The University of Adelaide’s professor of housing research, Emma Baker, said that “policies to reduce the stress and uncertainty associated with private renting, such as ending ‘no- grounds’ evictions, limiting rent increases and improving conditions, may go some way to reducing the negative impacts of private renting.”

But she failed to factor in the reality that implementing those kinds of policies – particularly rental controls and anti-landlord legislation - will cause even more investors owners to sell up and get out of the market, further reducing the availability of rental properties and worsening the shortage.

Not being able to find a rental property at any price is a bigger stress than having a rental home and struggling to afford it.

It’s quite unusual to see major lenders doing something proactive to encourage investors.

Generally the big banks, along with all levels of government, treat property investors as cash cows, with higher charges for everything compared with what home buyers are charged.

That includes higher interest rates, higher insurance rates, higher council rates, higher rates of stamp duty - plus taxes that home owners don’t have to pay, like land tax and capital gains tax.

There’s no justification for any of that, other than the reality that investors are a minority and it’s politically more palatable to slug them and not home-owners.

But right now it appears that the big banks believe property investors deserve some encouragement.

Evidently, they believe investors will be returning to the residential market in large numbers because rising immigration will lead an extended rent squeeze.

The 2023 net immigration number is the equivalent of a city the size of Newcastle being added to the population, with major impact on housing supply – at a time when the national average rental vacancy rate is around 1% and considerably lower in many parts of the nation – and building approvals are falling when we need them to be rising.

Commonwealth Bank, the nation‘s biggest lender, has now announced it will allow investors to borrow up to 95% of property’s value. The bank’s previous maximum was 90%.

That means investors can get a loan to buy a property with less of a deposit.

At the same time, another big four bank, NAB, has upgraded its forecasts on the outlook for residential property this calendar year to 8% nationwide, after another upgrade earlier in the year had suggested 5% - and not forgetting that at the start of the year they forecast house prices would fall 15% or more in 2023.

Across Australia, residential property prices have been rising, month by month, for all the 2023 calendar year.

In addition, rental income has been showing double-digit growth - but investors have largely remained on the sidelines, having been massively discouraged by a range of policies at all three levels of government.

NAB’s figures suggest the number of investors buying in the market has turned the corner with signs of early growth.

It says the market share of “local investors for established houses” has nudged up to 18% but still remains well below average.

Overall, it appears some of the big banks are seeing better prospects and higher activity ahead for property investors across Australia.

The remarkable steadiness for which the Adelaide market is renowned continues, with our latest survey of market activity showing that most suburbs in the South Australian capital have busy markets and rising prices.

Consistency has become the key defining feature of the Adelaide market.

Our Spring survey found that while there are relatively few suburbs classified as rising markets in Adelaide, there are large numbers of consistency suburbs – with steady sales levels over the past few years.

Overall, seven out of 10 suburbs have positive rankings – which is one of the highest in the nation.

There are three key factors which underpin ongoing demand in the Adelaide market.

One is that South Australia is one of the nation’s strongest economies and continues to thrive on the state’s innovation in the areas of technology and alternative energy, as well as being a key location for education and the Defence industry.

Another big factor is affordability. Despite recent good growth, Adelaide is considerably cheaper than Sydney, Melbourne, Brisbane or Canberra.

Homes in Adelaide are around half the price of Sydney’s.

Adelaide and Perth are the only capital cities in Australia where you can still find a good supply of houses in the $300,000s and $400,000s.

The third factor about Adelaide is the resilience and consistency of its market. In 2022, when prices generally fell in the bigger cities, Adelaide continued to deliver price growth.

And that steady performance has continued in 2023.

In the first nine months of this year, the median house price for Adelaide rose 5.3%, according to CoreLogic, while the median unit price increased 6.1%, which was above the national average.

And Adelaide continues to have one of the tightest rental markets anywhere in the nation. The national vacancy rate, according to SQM Research, is 1.1% - but Adelaide is less than half that national average, at 0.5%.

As a result, residential rents in Adelaide have increased more than 10% in the past 12 months.

Overall, Adelaide presents as one of Australia’s strongest markets, with consistency of performance its defining characteristic.

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Superannuation has the potential to become a powerful tax haven and wealth creator for Australians, if handled well.

Investment expert Andrew Courtney of Plenitude Wealth says many Australians, however, fall into the trap of being asset rich and cashflow poor with their investments. But he says it’s possible to transition from active income (salary) to portfolio income (earning from your portfolio of investments, including real estate). “Instead of trading your time for money, get your money to start working for you,” he says.

Courtney says people who …

 start early with a SMSF,

 set targets and milestones,

 exploit the available borrowing capacity,

 properly apply the tax benefits, and

 acquire good property …

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Somehow, according to the logic of the major economists, including those who work for the Reserve Bank, we may need to put up interest rates again to quell key inflationary pressures like residential rents and petrol prices.

As most of you will know, the Reserve Bank is obsessed with bringing down the rate of inflation.

And they’ve searched through their list of policies and possibilities – and come up with the brilliant concept that, if you increase the interest rates of one third of Australian households – the ones that have mortgages – somehow inflation will miraculously come down.

So, Plan A is to put up interest rates.

You may be tired of hearing about it, but the latest data on residential vacancy rates shows that they are continuing to fall.

And why wouldn’t they, given that the nation’s gaggle of politicians collectively haven’t got a clue about how to deal with this situation.

The latest data from SQM Research shows that the national vacancy rate dropped from 1.2% in August to 1.1% in September.

Comparing the situation with a year ago, Sydney’s vacancy rate has dropped from 1.5% to 1.3% and Melbourne is down from 1.8% to 1.2%.

In the latest month, vacancies dropped to lower levels, or stayed the same, in six of the eight capital cities.

Some of the nation’s leading economists have just released their forecasts for Australian property prices in 2023.

Now, I imagine you think I’ve made a mistake and that I meant to says that they’ve made their predictions for property prices next year, in 2024.

But No, they’ve made their forecasts for house prices in Australia this year – in late October. A little over two months before the end of the year, they’re telling us what they expect to happen with property prices in 2023.

This is according to a Bloomberg survey of 13 so-called leading economists published in the nation’s worst tabloid rag, the Australian Financial Review.

Now, you can’t blame economists for leaving it until the year is almost over to make their forecasts about property price outcomes for the year – because this is something they’re really bad at.

It’s a reality of modern life that most of the impending disasters forecast by news media never happen – and that is particularly so in the property industry.

Recent years have been full of startling headlines of a collapse of property prices, including in 2020 when Covid struck Australia and at the beginning of 2023 when bank economists predicted prices would drop 15% to 20% because interest rates were rising.

Journalists love these kinds of “impending doom” stories and are happy to publish scary headlines warning of us of dreadful things to come.

It causes a lot of unnecessary anxiety in a community already struggling with high interest rates, rising prices for life essentials, climate disasters, the outbreak of wars, earthquakes causing devastation and a whole lot more.

Media, of course, never apologises when the disaster they predicted does not occur.

One of the notions very popular with journalists seeking to generate clickbait with a startling forecast is the concept of a cliff. A property market cliff, a property price cliff, a mortgage cliff – according to news media, there are always things about to fall off a cliff.

Except it never happens.

Australia has just recorded its highest population growth in 20 years.

And the data about which areas of the nation are growing the fastest shows that the trend we call the Exodus to Affordable Lifestyle is continuing strongly.

Western Australia and Queensland continue to be national leaders on price growth, while the two biggest states on population, NSW and Victoria, continue to lose population through internal migration – which means people moving from one part of Australia to another.

The biggest part of that trend is people leaving our two biggest cities, Sydney and Melbourne, and moving to smaller cities or to regional areas.

That’s been happening in significant numbers for the past decade and was NOT caused by the Covid lockdowns, as some media reports have suggested.

Usually the term “a perfect storm” refers to a highly negative scenario.

One definition says a perfect storm is “an especially bad situation caused by a combination of unfavourable circumstances”.

I’d like to turn that around, because right now there’s a perfect storm of scenarios impacting real estate market and they’re overwhelmingly favourable for property investors and for real estate growth, while being extremely unfavourable for anyone looking for a place to rent.

Right now, real estate markets are being impacted by a well-entrenched imbalance between supply and demand – and it’s becoming increasingly pronounced.

Property markets across Australia have grown stronger as 2023 has progressed.

And this notable resurgence has been led by Sydney, which we regard as the leading market in the nation.

It is the market with the strongest data on sales activity, slightly ahead of Perth, and it’s also a national leader of price growth in 2023, both for houses and for apartments.

Sydney had shown signs of recovery early in 2023 but our most recent analysis shows that the city’s market has gone to another level more recently.

Most of the suburbs across Greater Sydney have experienced significant improvement in their market activity – which puts Sydney at the forefront of a national revival in sales volumes.

Regional NSW is part of the emerging recovery theme which dominates the national real estate scene, although its revival is perhaps a little less emphatic than some of the other states.

Earlier in the year, when Hotspotting conducted its Winter survey of sales activity, only a third of Regional NSW locations had positive outcomes.

But more recently our Spring survey revealed that two-thirds of locations had positive rankings.

This represents a meaningful turnaround in the Regional NSW market overall, although some high-profile locations like Byron Bay have yet to join the revival.

The biggest cohort in Regional NSW now is the recovering markets.

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News media is always happy to sensationalise an issue or embellish the facts to make sales but sometimes they go beyond what has always been known in the journalism industry as a beat-up. Sometimes, indeed increasingly often, what we are presented with is an outright lie – with journalists happy to present their customers with misinformation. It’s highly unethical and dishonest – and in legal terms there’s a word for it – it’s called fraud – seeking to make money dishonestly.

I recently attended the annual national conference in Sydney of PIPA, the Property Investment Professionals of Australia. In many ways this is the most important organisation in Australia in terms of finding solutions to one of the nation’s most pressing problems, the rental shortage. PIPA comprises people who deal every day with the people who supply over 90% of the homes that people rent in Australia – private investors. They’re often referred to as mum-and-dad investors, because most of the people who own investment real estate are ordinary households on average incomes who own just one investment property. This very important cohort provides the product which is in short supply and it would make sense for politicians to encourage them in any way possible to solve the shortage crisis. But the opposite is happening. Private investors are being massively discouraged and they’re leaving the real estate market in droves, as the new PIPA survey graphically illustrates. And that, in essence, is why we have the rental shortage crisis.

The person in the image behind me is Australia’s dumbest and most dangerous politician. I know that’s a pretty big statement, because Australia is full of politicians who are none too bright and who have ideas and policies which would be extremely damaging if they everbecame law – particularly on issues relating to the housing industry. But this character is the pick of a very bad bunch.

Now, more than ever, property buyers are seeking affordable options. First-home buyers are finding it harder to get into the market - through the combination of higher prices AND higher interest rates which reduce their borrowing capacity. Investors, too, are chasing more affordable options, because they also face the difficulty of higher interest rates and lower borrowing capacity pushing them into lower price brackets.

The key to success in property investment lies in identifying locations which will outperform the general market over time and pinpointing the right time to take action. Essentially this means forecasting events in markets across the nation. But is this realistically achievable for the average Australian consumer? The truth is that anyone can learn the basic tools for understanding property market dynamics well enough to determine when to get into the market and where to buy for long-term success. Indeed, the average consumer can easily outperform senior economists working for the major banks. Let’s face it, that’s not terribly difficult, given the poor track record of bank economists in forecasting house prices in recent years. Leading buyers’ agent Kate Hill of Adviseable says her decades of experience in Australian real estate have revealed simple principles for pinpointing good places to invest. On Wednesday 13 September, Hill joined Hotspotting founder Terry Ryder to discuss how prospective investors can learn the tools of identifying good locations and predicting likely outcomes with price growth. They exposed real estate’s greatest myths and misconceptions – fallacies which prevent many consumers from achieving success in property investment. Hill and Ryder presented case studies of locations which demonstrated the principles of finding growth markets and taking effective action.

One of the most dishonest and unethical things that politicians commonly do in this country is to find a way to increase taxes on specific sections of the Australian population - but present it to the public as a measure to improve life for ordinary people. We’re seeing this currently with attitudes to citizens who seek to establish a business by letting a property they own to tourists and other short-term visitors to the area. These kinds of properties typically use systems like Airbnb or Stayz and they’re popular with travellers who prefer to stay in a house or an apartment rather than a motel or a hotel room. And of course they’re perfectly legal and a reasonable thing for property owners to do to create a sustainable business. But local authorities have seized on this as another way to raise revenue.

Apartments are rapidly becoming the dwelling of choice for a majority of people in some of the key locations across the nation. More and more people are opting to buy apartments and other types of attached dwellings because of the low maintenance lifestyle and/or the lower buy-in prices. Right now, the strongest markets in our biggest cities are the inner-city areas where apartments dominate the residential real estate scene. All this is graphically illustrated in the new Spring 2023 edition of The Price Predictor Index, which analyses buyer demand for all the major suburbs and towns across Australia. This report finds that the strongest market precinct in the Greater Sydney area, right now, is the City of Sydney LGA, which encompasses the Sydney CBD and near-City suburbs like Potts Point, Elizabeth Bay and Darlinghurst. Indeed, we rank the City of Sydney as our National Growth Star, the strongest municipality for buyer demand in Australia.

My business, which publishes the Hotspotting.com.au website, has a pretty simple philosophy in the pursuit of success: if we make our customers happy and/or satisfied, we’ll be successful. The idea is to be helpful to people trying to achieve an objective – for example, finding a good location to buy a property to achieve a good rental return and capital growth over time. The philosophy is: if we’re helpful to people, they’ll become our customers and the business will be successful. In my experience, most businesses have approaches which are similar – if they provide good products and service, their customers will be happy and they will be successful. BUT … News media is different. The business model pursued by most forms of mainstream media is that they can make money by making people feel bad. Media organisations set out to profit by alarming people.

Tune Out the Noise & Tune In to the Experts
Legendary writer Rudyard Kipling suggested that “if you can keep your head when all around you are losing theirs” you will succeed where others fail. He wasn’t thinking of Australian real estate when he wrote those words but they apply aptly to the current situation in property markets. Many real estate consumers are confused amid economic disruption, political meddling, negative media and inconsistent data about market performance. It’s knocked people’s confidence and made them hesitant. Multi award-winning buyers’ agent and best-selling author Miriam Sandkuhler says success belongs to those who can tune out the white noise and see the opportunities. Those making good investment decisions amid the mayhem are usually those who have access to expert advice and quality research information. Now more than ever, real estate consumers need genuine experts in their corner – people they can trust to provide quality advice based on real knowledge and hard-won experience. Miriam Sandkuhler of Property Mavens recently joined Hotspotting founder Terry Ryder in a webinar to help you make sense of all that’s happening in real estate. Sandkuhler discussed which markets are firing, where there is potential for growth and the kinds of property strategies that will carry investors safely through good times and bad.

Every year around August, real estate agents and news media start chattering about the upcoming “Spring selling season”. The general theme is that this is the best time to sell, because flowers will be blooming and there will be optimism in the air as temperatures rise. But the same people who proclaim this to be the best time for vendors, also declare that this is the best time to buy. By definition, it cannot be both. If it’s a sellers’ market, it’s difficult to argue credibly that it’s a buyers’ market at the same time. Such is the nature of hype and hyperbole in the residential property industry. The truth is that there is no best season is which to sell or buy real estate.

We’ve seen significant improvement in markets across Regional Victoria recently, as the state joins the recovery momentum seen in many markets across Australia. Our latest survey of market activity shows that, in Regional Victoria, the revival has gone to another level lately. Our research shows that, in the latest quarter, the number of declining locations has halved and the number recovering locations has more than doubled. Locations with positive rankings in our survey have increased from 45% of total Regional Victoria locations to 65%, led by a surge in the number of towns and suburbs classified as recovering markets. 53 locations previously ranked as declining or plateau markets are now classified as recovering markets, up from 24 in the previous quarter, while the number of locations with negative classifications have dropped from 71 to 47. At the same time, locations previously ranked as recovering markets have continued to improve and are now classified as rising markets.

There are many reasons why housing is so expensive in Australia, but there is one major reason that over-rides all the others: politicians keep adding to the cost. Housing is ridiculously expensive in this country and keeps becoming more so, because all three levels of government treat the housing industry as a cash cow. They love to milk the housing industry for revenue – and are adept at finding new and innovative ways to create new taxes, fees and charges – or increase the existing ones. Politicians think they can do this with little electoral risk because, as they see it, they are slugging property developers, builders and investors with the tax hikes – and nobody cares about them, right? But the reality is that, ultimately, it’s home buyers who pay – including first-home buyers.

Here’s a quick quiz to see whether you’ve been paying attention lately.

Question one: How many times have predictions of things like property prices falling off a
cliff appeared in media headlines in the past, say, three years?

Question two: How many times have things actually gone ahead and fallen off the forecast
cliff?

Question three: Should we be listening any more to journalists and economists who predict
these dire cliff disasters?

So, how did you go with the quiz?

I don’t have the exact number of headlines which have forecast a mortgage cliff or a market
cliff or prices falling off a cliff, but it would number in the thousands so far in this decade of
the 2020s.

Now, as to how many times things have actually fallen off the alleged cliff, I do have a
precise answer: exactly zero times.

We were told property prices would fall off a cliff in 2020 but they rose.

The Melbourne market has staged a remarkable turnaround, transitioning from a struggling
market to one showing promise of considerable buoyancy in the near future.

Three months ago we reported the first signs of recovery across Greater Melbourne markets,
but our latest quarterly survey of sales activity has provided compelling evidence that
Melbourne is now coming back strongly.

The number of locations classified as rising markets has increased five-fold and recovering
markets have quadrupled, while plateau markets have halved and the number of declining
suburbs has dropped by 67 to just 9.

That’s quite a turnaround.

I should be accustomed to watching politicians failing to fix problems, but somehow I can
never get used to it.

The capacity for Australian politicians to blunder when we need them to excel is quite
extraordinary.

And I think part of the problem is that politicians are really only interested in the press
conference and haven’t thought much beyond that.

And so it is with the political response to the housing crisis.

The Prime Minister got together with all the state and territory premiers and first ministers to
talk about fixing the housing shortage.

These are our national leaders, the people we have elected to fix problems - like not enough
dwellings, the absence of affordability and the sharp rise in residential rents.

So they got together and talked about it and then held a press conference in front of the
assembled media.

What they presented was laughable.

Smart property investment decisions are best made by tuning out the news media.
Media is relentlessly negative, often fuelled by pessimistic forecasts from economists whose track records in predicting real estate outcomes is woefully bad. An online columnist, in reviewing the latest forecasts from one of the major banks, asked the question: "Should we still be listening?" The answer, we believe, is a resounding No! Those who listened to media forecasts sourced from bank economists in 2020, and decided not to invest, missed out on 20%-plus in annual price growth. Those who listened to the usual suspects at the start of 2023 would have deferred investment decisions because we were told prices would fall 15-20% - but instead they are rising steadily. There's a better way, based around sound advice, genuine research and sensible strategies. Hotspotting founder Terry Ryder recently hosted investment expert Danny Buxton of Triple Zero to discuss how to tune out the media white noise and make smart investment decisions. The webinar provides answers to these questions: 1. Is 2023 a time of opportunity for property investors? 2. Where are investors getting good results from capital growth and rental returns? 3. Which regions have the best growth indicators? 4. Is this a good time for investors to undertake new builds? 5. Should investors be deterred by politicians tinkering with the market? 6. Where do you go for accurate information and sensible advice?

A journalist on a national publication recently asked this question: “Should we be listening any more?” The writer was referring to the latest property price forecasts from National Australia Bank and pointed out NAB’s terrible record on predicting house prices. I wholeheartedly agree. I wish more journalists would challenge the major banks on their real estate predictions. It’s not just NAB: the property forecast track record of senior economists employed by all of the Big 4 banks is laughably bad. I often wonder how senior economists working for Westpac, ANZ, NAB and CommBank keep their jobs, given how often they predict negative price outcomes and are proven spectacularly wrong.

Dictator Dan Andrews, Premier of Victoria, leads Australia on a number of issues. When it comes to arrogance, incompetence, dishonesty and bad governance, there’s no politician anywhere in Australia, at any level of government, who can match Dan in any of those areas. Announcing this time last year that Regional Victoria would host the Commonwealth Games, that it wouldn’t cost much and the benefits would be huge – and then 12 months later scrapping the Games, claiming they would cost too much and there would be no benefits – that alone marks Dictator Dan as a politician setting new standards in bizarre behaviour and stunning incompetence. But there’s a lot more to worry about with this obnoxious individual – he has single-handedly made Victoria a No Go Zone for property investors – passing laws that are onerous to property owners and have significantly increased their costs of ownership, increasing stamp duty for certain types of purchases, announcing big increases in land tax and then announcing plans to bring in a rental cap. So, having massively increased the costs for property owners, he is declaring that those owners cannot increase their price.

Real estate research data is telling an increasingly strong story for apartment markets across Australia. Apartments, so long considered inferior to houses on land for investment solidity and long- term capital growth, are mounting a serious challenge to the supremacy of houses in the minds of Australian investors. In recent times, apartments have proved competitive with houses on capital growth and are out-performing houses on rental growth. More and more Australians are opting to live in units and townhouses for their lifestyle and affordability features. And apartments are grabbing an increasing share of the construction market with builders and developers.

Perth continues to be Australia’s strongest property market, with a busy and competitive housing scene and rising prices. The key information for real estate consumers is that Perth remains a long way short of having fulfilled its potential for growth. There’s still plenty of price rises to come. And one of the reasons for that is that Perth remains one of the most affordable markets in capital city Australia.

Pathways Digital provides transparency and certainty to the contract and agreement process for teams and their customers. This includes everything before signing, and the management of the resulting obligations for all parties. The platform helps organisations to store and manage all contract documents in a centralised repository, track key dates and milestones, and monitor contract performance and compliance. Pathways Digital also offers features such as electronic signatures, version control, document collaboration, and reporting to improve efficiency, reduce risk, and ensure contract compliance. On Wednesday 2nd August, Andrew Tiernan, CEO & Co-Founder of Pathways Digital will join Hotspotting General Manager Tim Graham to learn how Pathways Digital is helping Real Estate & Finance Professionals deliver exceptional customer experiences and ensure all parties have transparency around the progress of their sales and contracts.

The NAB Residential Property Index is forecasting price growth this year and next year – and that’s significant because it’s rare for this report to find any thing positive to say about Australian real estate.

NAB has been publishing this quarterly index report for many years and its hallmark is being extremely negative or conservative about property prices across Australia.

It forecast price decline in 2020 but prices rose and it forecast very moderate growth in 2021 and we saw an extraordinary property boom.

So to have the NAB Residential Property Index predicting solid increases in house prices not only this year but in 2024 as well is, I think, quite significant.

While the decision by the Premier of Victoria Dictator Dan Andrews to scrap the 2026 Commonwealth Games is extraordinary, it is also in one sense unsurprising.

Because that’s the way Dan Andrews runs his state, with policy on a whim according to the mood of the all-powerful Premier.

It’s only a year ago that Andrews announced that the Games would be held in Regional Victoria, that the cost would be $2.5 billion and that the benefits to the state would be considerable.

Twelve months later he claims that cost is now as high as $7 billion and no longer viable. Many authoritative commentators have dismissed the $7 billion figure as fanciful and plain dishonest.

The reality is that Victoria’s finances, under the leadership of Dictator Dan, are in disarray and it’s struggling to pay its bills and fund essential infrastructure – always remembering that under his guidance Melbourne became the world’s most locked-down city during Covid – and now Regional Victoria is paying the price.

If Australians fully realised the degree to which politicians have caused or exacerbated most of the major problems the nation faces, there would be rioting in the streets.

The streets of our major cities would resemble the recent scenes in France if there was a full appreciation of the way politicians create problems, fail to enact solutions to serious problems and/or create legislation that makes a serious problem worse.

Everyone with a mortgage is paying massively higher monthly costs because the Federal Government has taken no action to address rising inflation – leaving it to the Reserve Bank to use the dumb, blunt instrument of lifting interest rates to try to fix the problem.

Households across Australia are dealing with massive increases in energy costs because politicians have messed up the electricity supply system.

We’ve had royal commissions into multiple core issues, including aged care, the behaviour of the big banks, deaths in custody and many other issues – and there’s o evidence of improvement in any of those areas.

Housing affordability has been a massive issue for decades and there have been multiple government inquiries but the problem continues to get worse.

The rental shortage crisis has been building for years – and not only do politicians have no solutions, but every time they pass laws that impact on real estate markets they make it considerably worse.

Think about that for a moment.

Most Australians who invest in real estate fail to achieve their goal of creating a large and
sustainable property portfolio.

Over two million Australians own an investment property but 70% of them have just one
property and another 18% have two. That’s nine out of ten with just one or two properties.
Those who own five or more are less than 1% of the total.

And here’s why so many fail to achieve great success: they're herd animals.

They lack the ability and mindset to think and act independently.

That “less than 1%” who have a portfolio and a decent crack at success with property
investment? They’re the people, the minority of people, who have a plan and are willing to
invest in information and advice to make good decisions – and generally are able to take
action where most people are adopting a “wait and see” approach.

They accumulate good real estate assets and keep them. They make their next purchase when
they’re ready to add to their portfolios, regardless of public sentiment or the tone of media or
the trend with interest rates or the (alleged) state of the market.

The successful investor thinks and acts regardless of all that white noise in the background.

How long does it take for the value of real estate to double?

This is a topic that media regularly reports, but never in a particularly informed or helpful
way.

Media often refers to the alleged “industry standard” that property doubles in value every 7-
10 years.

According to writers on this subject, the industry makes this claim – that residential property
doubles in value every 10 years, or as fast as every seven years.

But I’ve never observed anyone in the real estate industry making that claim – it’s something
that media claims is said, but never provides any evidence.

We certainly would never make that claim, as it’s ridiculous generalisation about real estate
which is based on the erroneous assumption that all property behaves the same in every
location and at all times.

As I have often commented, generalisation by journalists and by economists is the curse of
Australian real estate consumers trying to understand real estate markets. It leads to a
proliferation of dodgy data based on rubbery figures.

It appears that investors are becoming more active in markets across Australia, based on the
latest lending figures from the ABS.

New lending to investors is certainly on the rise, with a 6.2% increase in May 2023. Lending
to owner-occupiers saw a more modest increase of 4% during the month.

This indicates that investor buyers are becoming increasingly active in the market, despite the
12 interest rate rises since May 2022 – providing further evidence that economists are wrong
when they assume that interest rate trends determine everything in real estate.

These new loan commitments have brought lending volumes to a level that is 45% above the
recent low in June 2020 – back when interest rates were at record lows.

Regional Queensland is a standout prospect for buyers of all kinds because it has so many locations that offer affordability, lifestyle and prospects for capital growth.

There are numerous regional cities with strong economies, significant spending on infrastructure – and the possibility of buying houses in the $300,000s and $400,000s, often with rental yields above 6%.

Recently, Hotspotting put together a major national report for Australia’s biggest comparison website Canstar.

The Bright Stars report focused on providing affordable locations for buyers, particularly young buyers starting out with real estate.

The report provided data for the 14 major market jurisdictions around Australia – the eight state and territory capital cities and six state regional markets. Of those 14 market precincts across the nation, Regional Queensland ranked fourth best in the report’s affordability scorecard.

One of the things many media commentators have in common is that they assume that if they didn’t know something was happening, then nobody knew it was happening.

It’s far better than admitting they were poorly informed about a subject on which they are claiming to be experts.

We see this with real estate prices all the time, especially with economists who struggle to get their forecasts right.

Usually, in fact, they get them spectacularly wrong.

So we currently have many commentators claiming that the price rises we’ve seen in many major markets across Australia since the start of 2023 are “surprising” or ‘unexpected” or indeed a “shock”.

I have to tell you that here at Hotspotting we weren’t shocked, nor did we find the price rises unexpected, because it’s what we forecast late in 2022 and at the start of 2023.

The Brisbane property market is a place of contradictions: it is currently a national leader on price growth at a time when sales activity is below par.

This dichotomy arises because of one of the dominant factors driving real estate in this era of higher interest rates: shortages of everything.

There is a serious shortage of listings of properties for sale, an under-supply of new dwellings under construction and a chronic shortage of homes for rental.

These imbalances in the Brisbane market are pushing up sale prices and rentals.

CoreLogic’s Home Value Index published on 3 July indicates that Brisbane house prices rose 1.3% in June, with prices up 3.0% in the June Quarter.

These growth rates are the second best in the nation, after Sydney.

At current growth rates, Brisbane will soon overtake Melbourne in terms of its median house price.

What does depreciation of Australian real estate assets have in common with living a dream lifestyle in Bali?
The answer is Tyron Hyde, who runs Australia's leading quantity surveying firm Washington Brown from a bamboo eco school on the iconic Indonesian island.
As the nation's foremost expert on how investors can use depreciation laws to dramatically improve their investment returns, Tyron Hyde has valuable information for property investors hoping to grow their wealth and perhaps retire early.
Hyde is the embodiment of that concept of living your best life while achieving financial success.

At our 4 July webinar Hyde we spoke about:
1. How he runs a successful Australian quantity surveying company from a jungle in Bali
2. How he changed his business model to work from home, long before Covid made it necessary and then trendy
3. How his business revolutionised its approach to providing depreciation services to property investors, which both saves them money and makes them money 4. How he built a successful and profitable business that doesn't need him to be there

As we approach tax time, we wanted to bring 2 of the best property tax specialists in the country to assist our Hotspotting audience in learning about the most tax effective investment structures available today. Join Tim Graham of Hotspotting to discover the secrets to successful structuring of property investments and more with Shukri Barbara and Amir Ishak from Property Tax Specialists. Tim, Shukri and Amir dig deep to uncover key strategies when concerning asset protection, income tax, retirement planning, family succession, and the use of negative gearing. Utilise the expert knowledge of the award winning accounting firm to develop your own financial roadmap for investing.

We are delighted to have recently hosted Sam Wakefield of Optalife as a guest speaker in our webinar, “Turning Assets into Retirement Income”. In this comprehensive 45-minute session, Sam offered actionable advice on goal-setting, steps to understanding your current financial position, strategies for building wealth and paying down debt, and designing a financial plan that will ensure you live your optimal life. Topics included: Superannuation contributions - benefits and considerations Strategies for a growing family Home upgrading How to make the most of your savings for retirement What financial options can you use to fund your retirement How to turn your assets into an income in retirement Investment exit strategies and much more

The right question is: WHERE is it a good time to buy real estate in Australia.

Because in this vast country, with so many different places and market scenarios playing out, it’s always a good time to buy SOMEWHERE.

At Hotspotting, we’ve just completed the work on the Winter edition of The Price Predictor Index.

This has included analysing sales activity for every significant suburb or town throughout
Australia – which means over two thousand different locations.

The results of this study confirm that we have a multi-speed market in Australia – which
means there are many different scenarios under way throughout the nation.

There really is no such entity as “the Australian property market” - because it’s normal to
have, at any point in time, markets which are rising, markets which are stagnating, markets
that are falling and – particularly right now – locations which have been previously weak but
which are now showing signs of recovery.

This is certainly the case right now in Australia.

The consistently solid performance for which Adelaide is now renowned is evident in the results of our latest survey of sales activity.

Indeed, our survey has found the highest number of consistency locations in Adelaide in the eight years of our quarterly surveys – and it’s this steadiness of performance which has become Adelaide’s trademark.

So, overall, Adelaide provides an attractive equation for property investors – affordable prices, low vacancy rates and rising rents, underpinned by one of the nation’s strongest economies.

So make sure you get a copy of the new Top 5 Adelaide Hotspots report and find about some of the best value real estate anywhere in Australia.

https://www.hotspotting.com.au/product/top-5-adelaide/

Following the multiple interest rate rises of the past year, more and more property investorsare seeking to buy in places that offer high rental yields.

The good news is that, even with significantly higher interest rates, if you select the right locations you can find properties with rental yields high enough to cover all your costs of ownership.

And you can achieve this without high-risk strategies like buying in mining towns.

To cater for this growing demand from investors seeking positive cashflow in a high-interest- rate environment, we have created a new report: The National Top 10 Hotspots for Positive Cashflow Properties.

Find out more ...

I wonder how many people would answer this question correctly: what’s the fastest growing city in Australia?

Many people might consider Brisbane, maybe Perth, perhaps the Gold Coast.

But the fastest-growing city is none of those places.

The answer is the Warragul-Drouin region in Victoria.

According to a new analysis of population data, Warragul-Drouin had the highest growth rate both in 2022 and in the past five years.

Its population rose 3.3% in 2022 and by 20% in the past five years – admittedly rising from a low base to reach 44,000 people last year.

Most investors cap out at 1 investment property because they are not aware of how to replenish their borrowing capacity. This webinar will be going over strategies on how to go about tapping into unlimited borrowing capacity for the everyday investor.

“The Doubling Game” is a proven system that can transform your financial trajectory, propelling you towards unprecedented success. As Andrew explains, doubling your net assets multiple times is the key to unlocking massive wealth. Imagine starting with $1,000 and doubling it ten times to reach $1 million. Double it ten more times, and you’re a billionaire! This incredible potential is within your grasp, although it can be hard to get there alone.

During this webinar, Andrew Courtney of Plenitude Wealth and Hotspotting founder Terry Ryder will guide you through the workings of “The Doubling Game” and demonstrate how strategic real estate investments can accelerate the process. Discover the crucial factors that determine the speed at which you can double your assets, and gain extremely helpful insights on leveraging the power of your borrowing capacity to reach your financial goals.

One word explains everything happening in real estate currently: shortage.

There is a shortage of listings of properties for sale, which is pushing up prices at a time when economists told us to expect falling prices.

In the March-April-May quarter, capital city house prices rose an average of 3%, while apartments increased 2.3%, according to CoreLogic. Every capital city and most regional markets recorded house price increases in the month May, while unit prices also rose in most areas.

The May growth for houses was led by Sydney, up 2.1%; Darwin, up 1.6%, Brisbane, up 1.5% and Perth, which rose 1.2%. Outside of the capital cities, there was growth also in the regional markets of NSW, Queensland, South Australia, Western Australia and Tasmania.

There are two very strong and important reasons why politicians need to encourage Australians to invest in residential real estate.

The first and most immediate one is that this is the best and fastest solution to the rental shortage crisis. The second and more long-term reason is that, in a country with an ageing population, we need to encourage people to provide for their own retirement through investment.

Which is the polar opposite of what’s been happening throughout the past five years or so. We’ve been discouraging people from investing in real estate and the country will suffer both short-term and long-term consequences from the stupidity and short-sightedness of our politicians.

If we don’t turn around this issue and provide incentives for people to invest for their retirement, we face the same agony that they’re experiencing in France, where they’re attempting to extend the retirement age amid widespread and sometimes violent protests.

The reasons for the rental shortage crisis and the consequent increases in rents can be summarised in two words: state politicians.

The policies and actions of state governments across Australia have created the situation where we have too few rental properties in the market.

And, showing the remarkable capacity of politicians for stupidity, most state governments right now are working very hard on making the situation worse.

The Greens attract a big enough share of votes to have an influence on federal politics because of people’s concerns about climate change and other environmental issues.

But they continue to distinguish themselves with economic policies that would be extraordinarily damaging if they were ever implemented, especially their policies on the housing market.

There is a growing body of research data showing that real estate markets are much stronger than we were told to expect in 2023.

Sales activity remains consistent or strong in many key markets, prices are rising in most of our capital cities and many of our regional markets, and vacancy rates remain ultra low.

The key factor driving this resilience of property markets, regardless of all those interest rate rises, is (in a word) shortage.

There’s a shortage of everything that matters in real estate: a shortage of listings of properties for sale, a chronic shortage of properties available for rental and a shortage of new dwellings under construction.

This is putting upward pressure on prices – and that pressure is big enough to overcome the negative forces like higher interest rates, high inflation and negative media.

The most perplexing and frustrating thing about life in Australia is that despite our good fortune, our wealth and our resources, we never seem able to find solutions to the problems that afflict our nation.

Whether it’s aged care, the health system, climate change, youth crime, deaths in custody, housing affordability or the rental shortage crisis, we never get to the end game – resolving the problems by implementing viable solutions.

And here’s why.

It’s because all the energy and focus is directed to finding a scapegoat for the problem and vilifying them in the media – not towards understanding

This is The Year Of Opportunity for property investors. It presents the potential to buy well in locations with growth credentials, achieve good rental yields to offset higher interest rates and find rising income through rental increases amid historically-low vacancies. On Wednesday 24 May property investment expert Jason Paetow described why switched-on investors are “buying the dip” – setting themselves up for future growth by investing in a climate of reduced competition from buyers, but growing competition among tenants for increasingly scarce rentals. Paetow, the Managing Director of AllianceCorp, explained where the market currently sits and what it will look like as the year progresses. He joined Hotspotting founder Terry Ryder in this free webinar event to discuss where to find the best opportunities in markets across Australia which offer affordability, higher yields and potential for capital growth.

Now more than ever before, the issue that drives the decision-making of most real estate consumers is affordability.

Over the past 12-18 months when some markets across Australia have been struggling, the ones that have remained buoyant have been the ones where home buyers and investors can find properties at attainable prices – with rising interest rates making this even more of an imperative.

It’s not a coincidence that the capital cities which have remained busy and competitive recently are the cheapest ones – Perth, Adelaide and Darwin.

Equally, the cities where markets have dropped the most through this period are the most expensive ones – Sydney, Canberra and Melbourne. Regional Australia – generally speaking – has performed better than capital city Australia because there are much more affordable options for buyers of all kinds outside of the big cities.

Very low vacancy rates have been the reality for most parts of Australia for years now.

And, as a consequence, we’ve seen major rent rises, causing financial hardness for more and more tenants – if they can find somewhere to rent at all. Until recently, media has reported the fact that there is a shortage of rental properties and that rents are rising fast – but there has been no analysis about why we are in this difficult situation.

Now, at last, media is starting to write about the circumstances that have led us to a national rental shortage crisis – specifically, the series of political actions which have deterred investors from buying properties and making them available for rent – or prompting investors to sell up and exit the property investment market.

For anyone who cares about the big issues afflicting housing markets, the Federal Budget delivered on 9 May was a monumental disappointment. Many Australians – including myself – believe that the biggest issue confronting the most people in this country is the COST OF SHELTER.

The big issue is the cost of buying homes and the cost of renting homes – with one key word describing the essence of the problem: SHORTAGE.

We have a shortage of everything that matters in our housing markets:- * A shortage of listing of homes for sale

A chronic shortage of homes for rent
A shortage of construction of new dwellings
A shortage of the materials and tradespeople needed to build new homes
A shortage of affordable options for people early in the property life cycle.

And there was nothing – NOTHING – in this Federal Budget which addressed the underlying causes of these endemic problems.

Some green shoots of recovery have appeared in the Regional NSW market after a year in which the market steadily declined in many locations.

While locations classified as rising markets continue to be scarce, there are significant numbers of locations which have maintained consistent sales activity through the downturn period – and meaningful numbers of locations which have recently reversed the previous decline in their sales activity.

At the same time, there remain a number of locations which have been in decline for the past year or longer.

And plateau markets, those where sales activity has tapered off and settled at levels below the previous peaks, continue to be the biggest cohort in the Regional NSW market.

If you bought a property for $450,000 a year ago and, despite media rhetoric about prices falling everywhere, it was worth $570,000 today, you would be happy, right?

If you made $120,000 in capital gains on a $450,000 outlay, amid the so-called national market downturn of the past 12 months, you would feel satisfied with your decision-making.

How about if you’d bought a property for $620,000 a year ago and it had grown to be worth $755,000 today, regardless of interest rate rises and constantly negative media?

You would be happy with a capital gain of $135,000.

That’s the power of the Best Buys report by Hotspotting.

Have you ever wondered how the members of the Reserve Bank board can so nonchalantly inflict the pain of constant interest rate rises on the families of Australia?

Here’s why. The members of the board which make these decisions don’t feel the pain of their decisions.

They’re all multi-millionaires – high-flying corporate executives, academics or economists with massive incomes which separate them from the pain of mortgage payments.

Most wannabe investors are herd animals, who dive into markets when they hear there’s a boom happening.

But successful investors seek opportunities when markets are off the boil.

They get busy when the markets aren’t moving, interest rates are rising, media is negative and most punters are sitting on the sidelines.

That’s when there’s less competition in the market and skilled investors can find the best opportunities for value-adding investments.

Those investors know how to make money irrespective of what the market is doing.

On Wednesday 10 May, Hotspotting founder Terry Ryder was joined by Brad Cassidy of The Kaizen Way, who specialises in helping people find profitable property deals regardless of the economic climate or the real estate cycle.

Cassidy says educated investors know how to find properties that allow them to accelerate growth and create wealth through adding value.

On 10 May he will share his business models for finding the best property deals with opportunities to create your own growth, without relying on the market to do it.

Cassidy says: “We love it when the media is negative about property and most people are sitting on the sidelines. That’s the best time to use our strategies.”

There’s growing evidence of a trend in Australia’s biggest cities of rising demand for apartments, both for reasons of affordability and reasons of lifestyle. In the most expensive capital cities, more people are opting for apartments in suburbs where houses are too pricey, but apartments cost less than half the price of houses. We’re seeing it in inner-city and middle-ring suburbs in Sydney, as well as Melbourne and Brisbane. In some of these locations, typical houses may cost $2 million but mainstream apartments in the same suburbs are available in the $700,000s or $800,000s. This trend has been particularly noticeable in Sydney in areas such as the Inner West local government area or in the Canterbury-Bankstown LGA.

Get the new Top 5 Sydney Hotspots report which will give you a detailed analysis of the Sydney markets that have the best prospects for growth through 2023 and beyond - both for houses and the more affordable apartment market.

Week by week, more data emerges which confirms the general recovery in Sydney prices.

We’ve seen sales activity increase in some of the Sydney markets, auction clearance rates improve, rents continue to grow and prices show increasing signs of returning to growth.

Are we surprised? No, this is what we forecast, particularly after analysing the sales activity figures for the December 2022 Quarter, which showed improvement in key sections of the Greater Sydney market.

Discover which areas are leading the recovery with strong potential for further growth this year. https://www.hotspotting.com.au/product/top-5-sydney/

Consumers trying to make decisions about WHETHER to buy or sell, or WHERE to sell or buy, need information that provides a clue to price movements in the future.

Knowing what happened to prices last month or last year doesn’t necessarily assist, because often THE PAST DOES NOT INFORM THE FUTURE.

This Exodus to Affordable Lifestyle is the internal migration of people from the big cities to smaller cities or to regional areas, propelled by technology which gives people the ability to work remotely – and therefore leave the big, expensive, congested cities and access a more affordable and more relaxed lifestyle elsewhere in Australia.

In December 2022 we wrote: “Our view at Hotspotting is that most markets across Australia will deliver some level of price growth in 2023. There will be regional differences, as is usually the case in real estate, but the general trend will be solid increases in prices.” The emerging data from PropTrack, SQM Research, Domain and CoreLogic confirms our views, with the price data in the first three months of the year turning increasingly positive.

Evidence of real estate revival in many of the previously struggling city markets continues to mount.

The CoreLogic figures published earlier in April showed significant improvement in a number of the capital cities of Australia, led by a big increase in Sydney house prices.

The latest figures from SQM Research, published on April 18, provide further evidence of the return to price growth in cities that were previously lagging behind better performers like Perth and Adelaide.

The SQM figures for the past month show a 1.4% rise in house prices, as the average result across the eight capital cities.

One of the recurring themes in news media about real estate affordability is the claim that today’s young buyers have it a lot harder than their parents did when they were buying their first home, perhaps a quarter of a century ago.

But, like so many things espoused in mainstream media about residential property, it really isn’t true – not when you look fully at all the factors in play and crunch the numbers.

Recent research - which used data from the Australian Bureau of Statistics and the Reserve Bank of Australia - found that Millennials actually have it easier than did Baby Boomers, when it comes to the portion of weekly income spent on the monthly mortgage.

And, as one of those Baby Boomers buying my first property back in the late 1980s, I can testify to how hard it was – primarily because interest rates were so incredibly high and there were considerably fewer loan options.

And that really is the crucial difference.

Consumer confidence, that rather intangible but nevertheless important component of the property market, is showing signs of serious improvement.

And the area in which consumer sentiment has improved the most is with the outlook for property prices.

It’s the latest in a series of indicators showing evidence of recovery in the major markets which have been struggling since the beginning of last year.

The Westpac-Melbourne Institute Consumer Confidence Index lifted 9.4% in April, with confidence across mortgage holders growing by even more, at 12.2%.

Prospects for markets across Greater Melbourne will improve as 2023 progresses.

The key factor that will drive a return to higher market activity and prices is the impact of migrants and overseas students.

And this will build on the recovery which is already under way.

International borders re-opened in 2022 and this has led to an influx of overseas migrants and students, with Melbourne a key destination for those coming to Australia.

But it takes time for this to translate into major impact on property market activity.

The first impact is on the rental market, with overseas students helping to create a sharp decrease in the vacancy rate for Melbourne.

Regional Victoria continues to display resilience and consistency in line with its reputation, although the overall trend in the market lately has been weaker.

And we continue to see good prospects for specific locations in Regional Victoria, with the impact of 2026 Commonwealth Games a significant factor.

Over the past six months, we have noted that the Regional Victoria market overall has weakened compared to the previous quarters – but that it had remained solid in the face of the downturn pressures which have afflicted Melbourne.

Consistency of performance is the key characteristic of the Victoria market.

Grab a copy of the latest Top 5 Victoria Regional Hotspots and discover the markets with the best prospects for future growth.

There are many myths and misconceptions about what works best in real estate.

There are those who believe that you need to be close to the CBD or to buy in the expensive so-called prime suburbs to get the best capital growth, but the research data shows that this is nonsense.

Many Australians think that you need to buy in the capital cities, rather than regional areas, for superior price growth, but the regions have been out-performing for many years now.

The old paradigm that houses on land deliver better capital growth than attached dwellings like units and townhouses has been challenged by the results of the past two years, including recently during the times of rising interest rates.

And there are those who cling to the notion that you have to buy in the biggest cities, specifically in Sydney and Melbourne, to get the best long-term capital growth.

That one is a serious misconception as well.

Of the many definitions of “economist”, the best of them claims that an economist is someone who will tell you tomorrow why what they predicted yesterday didn’t come true today.

This reality of economists constantly getting it wrong with their forecasts, but refusing to admit they were wrong, is seen pretty much every day in Australia.

The property data from multiple research sources is becoming increasingly positive – not that it’s ever been as negative as mainstream media has portrayed.

A more optimistic outlook for real estate markets is being seen in data on sales activity, auction clearance rates and prices.

These more positive outcomes have occurred despite 10 consecutive interest rate rises by the Reserve Bank - and pre-date the RBA’s decision to pause the rate rises at its April board meeting.

And it’s worth re-iterating that, right throughout this period of continual rate increases, many major markets in Australia have continued to deliver rising sales activity and rising prices.

Perth, Adelaide and Darwin in particular, as well as many of the regional markets, have continued to defy the downturn pressures that have been most evident in Sydney and Melbourne.

Of the many definitions of “economist”, the best of them claims that an economist is someone who will tell you tomorrow why what they predicted yesterday didn’t come true today.

This reality of economists constantly getting it wrong with their forecasts, but refusing to admit they were wrong, is seen pretty much every day in Australia.

Perth is the nation’s strongest property market.

At a time when the market in our biggest capital cities have been struggling, Perth has continued to thrive.

Amid all the disruption that’s been afflicting property markets across Australia, Perth is still delivering strong sales activity and price growth.

We’ve just completed our latest quarterly analysis of sales activity – and it shows that two-thirds of suburbs in the Greater Perth area have maintained high levels of sales activity in defiance of the nationwide downturn pressures.

Of the 194 Greater Perth suburbs in our analysis, 63 are classified as rising markets and another 63 are consistency markets.

To have two-thirds of locations maintaining strong buyer demand is exceptional in the current climate of economic disruption.

Get the latest Top 5 Perth Hotspots report for all the details on Perth's strongest suburbs.

A growing number of positive indicators are emerging from the real estate industry, providing confidence that the worst may be over for those markets that have been in decline for the past 12-18 months.

It’s worth noting that not everywhere in Australia has been in downturn lately.

Far from it – our latest quarterly analysis of sales activity shows 20% of suburbs and towns have rising sales volumes and another 22% have consistent buyer demand.

On Monday 27 March the ABC television program 4 Corners ran an expose on its own shallowness and shabby journalistic standards.

The ABC personnel who put this piece of tabloid television together probably imagined they were crafting an expose of the residential property industry.

It could have been that if the ABC had adhered to quality journalistic standards – but those days are long since past, it seems.

It was titled “Agents of Influence” and it purported to expose the dirty hidden secrets of the industry that manages the sale of homes.

There were a few problems however.

Misinformation about real estate is rife in Australia, to the extent that most of the nation’s citizens are utterly and constantly confused about what is really going on in our housing markets.

But the single worst piece of misinformation of all, among the many that afflict Australian consumers daily, is a report published each year under the title of Demographia.

Every year this report claims that Australia has the most unaffordable homes in the world, or close to it.

And that Australia’s largest cities are among the most unaffordable in the world – with Sydney currently claimed to be the second most unaffordable city on the planet.

But here’s the key point: this report doesn’t produce any evidence to back up its spectacular claims about where Australia sits in the world of real estate.

Media continues to discuss the downturn in “the Australian property market”, but our analysis confirms there are many different scenarios playing out across Australia.

There really is no such entity as “the Australian property market” – because it’s normal to have, at any point in time, markets which are rising, markets which are stagnating and markets that are falling.

This is certainly the case right now in Australia. This is the norm for residential real estate in this very large and diverse country – and it’s nonsense for economists to speak of “Australian property prices” rising 10% or falling 10% – because there is no national market situation.

This reality is illustrated vividly by the quarterly editions of The Price Predictor Index, in which we analyse thousands of housing markets throughout Australia to determine the patterns with sales activity, which means buyer demand.

We do this because sales volumes are a forward indicator of what will happen with prices.

Rising transaction levels are usually a precursor to property price growth.

Equally, if sales activity is falling, price growth will slow, or stop – or prices may fall.

So, right now, our quarterly analysis shows that there are markets that continue to rise, many that remain consistent despite all the disruption, others that have tapered off at levels below the previous peak and some that are showing distinct patterns of decline.

This is “situation normal” in Australian real estate.

Across Australia, there are close to 500 towns and suburbs where sales activity is rising and over 500 more with consistent market performance.

Our new Autumn 2023 edition of The Price Predictor Index shows that Perth, Darwin and Adelaide are the strongest capital city markets, while Canberra and Melbourne are the weakest overall.

So get yourself a copy of The Price Predictor Index. It’s a great way to be informed about individual markets right across Australia – and their prospects for 2023 and beyond.

Get your copy at https://www.hotspotting.com.au/product/price-predictor-index/

The State Government in Queensland has been devoting itself recently to demonstrating why Australia has a rental shortage crisis.

Vacancy rates are the lowest ever recorded and rents are rising in most markets across the nation - because the people who supply rental properties have been consistently and systematically discouraged by the actions of politicians.

The leadership of the Queensland Government provide headline examples of the problems.

Recently there have been media headlines along the lines of “Rental crisis shows no sign of softening”, as if there was an expectation that vacancies should be rising and rents easing.

Of course there are no signs of the rental shortage crisis softening. It’s going to get considerably worse before it gets better.

There are few things in life, or in real estate for that matter, that are sure things – but this is an absolute certainty.

The rental shortage crisis WILL get worse, from the viewpoint of people looking for a place to rent.

The good news about interest rates is that it appears we are at, or near, the end of the cycle of rising mortgage rates.

That’s if you can believe the words of the Reserve Bank Governor, Philip Lowe.

But of course, we can’t believe him because he’s the guy who kept telling us he wouldn’t be lifting interest rates before 2024, just months before he started lifting interest rates 10 months in a row.

That’s Philip Lowe who earns over $1 million a year and bought his Sydney home with a special cut-price loan available only to elite privileged people, so he doesn’t understand the pain he’s inflicting on households around Australia.

One of the best ways to be sure that a property market will be a good performer long-term is to confirm that it’s under-pinned by a strong local economy.

I believe property markets are local in nature and that the strength or otherwise of property markets depends largely on events in their local economies.

So we at Hotspotting are always interested in the economic activity that’s happening in the background, in assessing property markets.

Is the local economy strong and diversified?
Is the local economy creating jobs?
Is the population growing?
Is there investment in infrastructure happening and/or in planning?

If the answer to all those questions is yes, then there’s a good possibility that the local market you’re looking at will produce growth in its property prices.

Regional Queensland has a significant number of large regional cities with growth economies and big infrastructure spends – but which also offer attractively affordable house prices and higher yields to compensate for rising interest rates.

It’s become abundantly and alarmingly clear that the Federal Government is coming for us with new taxes on real estate and superannuation.

Headed by Federal Treasurer Jim Chalmers, the Government clearly has plans for more and higher taxes on real estate, with not even the family home safe from the intrusion of capital gains tax.

Asked repeatedly by various media representatives to rule out dumping a tax on the family home, Federal Treasurer Jim Chalmers repeatedly refused to do so.

This is scary, scary stuff.

There is a growing body of evidence that property market conditions are strengthening.

Against a backdrop of an ever-tightening rental market and increasing rents, there are signs of rising buyer activity and stronger prices.

Auction clearance rates are showing steady improvement in recent weeks and a number of research entities are recording price growth, in defiance of high inflation, rising interest rates and relentlessly negative media.

The more positive data began with the release of Domain’s price report for the December Quarter.

This recorded house price growth in five of the eight capital cities.

Then came figures from SQM Research which showed most capital cities recorded price growth in January for houses - and all but one of them recorded growth in median prices for apartments.

Brisbane and Queensland are among the biggest targets for property investors in 2023 - and for very good reasons.

In many respects, when it comes to the key factors that drive real estate markets forward, all roads lead to Queensland.

Investors seeking the best place to put their money want to see a strong economy, they want to know that the population is growing, that big money is being spent on new infrastructure and that there is growing focus on the region they’re targeting.

They also want real estate that’s affordable, where demand from tenants is strong and rents are growing, and in many cases in the current climate they want above average rental yields.

Queensland and its state capital tick all those boxes.

One of the things you’ll never get from Australian media is a Mea Culpa.

Media will never apologise for getting it wrong or causing harm or grief to the people of Australia, unless they’re legally forced to do so.

They will nonchalantly declare that the value of our homes will drop 20% or 30% or 40% in the next year – and then 12 months later when they’re proven spectacularly wrong, you’re not going to get an apology.

Because, let’s be clear, those kinds of sensationalist predictions, which are common in Australian media, do cause considerable grief in the community.

Which brings me to the latest item of serious misinformation that has been inflicted on Australian consumers – that the trend of people leaving the biggest cities and moving to the regions or smaller cities, is over.

Recent articles simply and emphatically have declared that it’s over.

Everyone, apparently, is moving back to the big cities.

Let me tell you, nothing of the sort is happening.

The core population trend which has seen large numbers of people leave the biggest cities and move to smaller cities or to regional areas has been happening for many years.

The official population data shows that Sydney has been losing population to other parts of Australia for the past 10 years and Melbourne has been losing to internal migration for the past five or six years.

The Covid lockdown period made this more visible and gave it extra momentum, but it certainly wasn’t the driving factor.

Fundamentally this big migration of population has been caused by the pursuit of lifestyle and affordability, enabled by technology – which means, the ability to work remotely.

Australians have been relocating in big numbers and the most popular destinations have been Queensland and Western Australia, with Queensland No.1 by a big margin.

Our latest Exodus to Affordable Lifestype report features 10 locations across the country where local economic drivers provide a solid base for affordable homes in attractive locations.

Grab your copy today The Exodus to Affordable Lifestyle - Feb 23 edition

The situation for tenants across Australia keeps getting worse, because vacancy rates keep falling – and that means rents will keep rising.

The latest report from domain.com.au finds that the national vacancy rate in January was 0.8%, the lowest on record.

The other major source of data on vacancy rate, SQM Research, has a similar figure.

Two of our capital cities, Perth and Adelaide, have vacancy rates of just 0.3% - and there are now only two cities with vacancy rates above 1% - Darwin at 1.3% and Canberra at 1.5%.

Keep in mind that a vacancy rate below 3% is considered a shortage, under 2% is a serious shortage and under 1% is a national crisis.

When your vacancy rate is 0.3%, there’s virtually nothing available to rent and it’s common now to see queues at open houses stretching out the door and down the street.

In circumstances like this, rents inevitably must rise and the cost of living problems for ordinary Australians keep getting worse.

Australian property markets abound with opportunities for real estate investors in 2023. Consumers can be forgiven for not realising that, given the sensationally negative nature of media coverage of housing markets. But, right now, the equation for property investors seeking opportunities is particularly strong. Consider these realities:- • Many markets are less competitive than before, with buyers having the upper hand in negotiations. • Vacancies across Australia are the lowest ever recorded. • Rents and yields are rising, providing good compensation for rising interest rates. • Most specialist property analysts – including Louis Christopher of SQM Research, Terry Ryder of Hotspotting and Simon Pressley of Propertyology – are forecasting that prices will rise in most locations in 2023. That equation represents opportunity for investors who buy strategically. Multi-award-winning buyers’ advocate and best-selling author Miriam Sandkuhler of Property Mavens featured in a webinar on Wednesday 8 February 2023 hosted by Hotspotting founder Terry Ryder. They outlined the current state of key markets and how to identify the best opportunities for strategic investment in 2023.

Have you ever wondered why we NEVER achieve solutions to the biggest real estate issues confronting Australia.

Housing affordability has been debated in the country for decades and every year it gets worse.

The rental shortage has been a reality for years and has attracted a lot of media attention and much political rhetoric, but vacancies remain at record lows and rents keep rising, with no resolution in sight.

And there’s a very good reason why solutions are never found to these core issues.

It’s because the finger of blame is always – ALWAYS – pointed in the wrong direction.

Fundamentally, it’s because politicians have caused these dilemmas and our politicians are very good at blaming others for the problems they have created.

And so it is, right now, with the rental shortage crisis.

There is a growing body of evidence that the worst of the downturn has passed and there are significant numbers of locations across Australia where prices are now rising.

We recently saw the publication of the latest price report from domain.com.au, which recorded growth in the median house prices of five of the eight capital cities in the December Quarter.

Now the latest Weekly Prices Index from SQM Research has provided more substance to the trend of positive price trends in a growing number of key markets.

According to the new SQM report, house prices grew in four of the eight capital cities during January, headed by the 2.7% rise in Adelaide.

The other cities to record rises were Brisbane, Perth and Darwin.

The general tactic of politicians when they haven’t got a clue how to resolve an issue – which is most of the time – but want to give the appearance of doing something, is to blame an unpopular minority for the problem.

A very popular choice when it comes to housing affordability issues is foreign investors.

You can slam foreign investors without any direct electoral consequences, because foreign investors don’t vote in Australian elections.

As politicians, they can present themselves as big and tough by banning foreign investment – or, even better, slug them with major new taxes as a way to raise more revenue from the housing industry – while claiming in front of the media that they’re doing it to improve housing affordability and help first-home buyers.

The problem is – it doesn’t work.

Foreign investors are not, and never have been, the cause of unaffordable housing in Australia or anywhere else.

While much of the mainstream media commentary on the property market focuses on the highs and lows of the big capital cities, it was Australia’s smaller capital cities which shone in 2022 – and they continue to do so in 2023.

Adelaide, in particular, is one of those shining stars.

Overall, Adelaide is a story of continuing high sales activity and on-going price growth, remaining generally one of the strongest markets in the country.

Indeed, the 2023 edition of the Rising Stars report which I published recently in collaboration with the comparison website Canstar, ranked Adelaide the No.1 market in the nation.

The Rising Stars report used a series of forward-looking indicators to rank the 14 major market jurisdictions of Australia (8 capital cities and 6 state regional markets) on their prospects for growth in 2023.

Adelaide topped the national rankings based on our analysis of sales volumes, vacancies, rents, price patterns and infrastructure spending.

The reality of statistics is that you can use them to tell any story you like. This reality impacts real estate consumers every day.

You can take any set of figures about house prices and use them to tell a positive story or a negative one, depending on your viewpoint.

Media, usually, will choose the negative option – and the people who feed press releases to journalists, seeking publicity for themselves, know that sensational negatives get more publicity than balanced analysis of property markets.

So the publicity seekers will place their focus on screaming negatives in their effort to lift their public profile – and the journalists of Australia will happily comply.

The mantra for media has always been: If it bleeds, it leads.

So when CoreLogic ran the numbers on price movements in the various locations across Australia in 2022, they found that roughly half had recorded price increases and half had price declines.

All the headlines around Australia screamed that half of locations in the nation had dropped – or, to use media parlance, they had plummeted, nosedived, collapsed or fallen off a cliff.

The headlines could, with equal validity, have shouted that half the nation’s locations actually recorded higher prices– which, given the tone of media coverage lately, is a remarkable outcome.

If you’re a long-term customer of a major bank with a mortgage and you’re paying their standard mortgage rate, then you’re likely paying a loyalty tax.

That’s because new customers to your bank will be offered a lower interest rate than the one being paid by the bank’s longer-term customers.

There are many things about the behaviour of the major banks that are disturbing - but few things annoy me more than their policy of providing the best loan deals to new customers, while refusing to offer the same terms to their existing, long-term, loyal customers.

There are far too many Australians who feel it’s right to stay loyal to the major institution they’ve banked with for years.

But the reality is, your loyalty is not being reciprocated by the bank.

Sometimes the best clues about what will happen with property markets come from the things happening behind the scenes, often hidden from the view of the general public.

News media obsesses over the latest price data as the best way, indeed the only way, to chart what’s happening with property markets.

But, for everyday consumers, this is essentially useless information because it tells you what has happened recently – if you believe the dodgy data pumped out by the attention-seeking research companies.

What Australian consumers really want to know is what will happen with prices in the future.

What has happened in the past might be interesting, but the past often does not inform the future, which is what matters most to people.

So our focus at Hotspotting is examining and analysing forward looking indicators – sets of information which can provide a clue to the future.

It will probably surprise many people to learn that house prices are rising in most Australian capital cities at the moment.

That’s according to the new House Price Report from one of the nation’s leading real estate websites, domain.com.au.

The Domain report indicates that house prices rose in the December Quarter in five of the eight capital cities.

The report records house price growth in Melbourne, Adelaide, Perth, Hobart and Darwin in the December Quarter, led by the 3.3% quarterly rise in Darwin.

And those cities, except Melbourne, also recorded annual growth in their house prices.

I find it quite startling that no one in this country questions the prevailing theory that the best way – indeed the only way – to fight inflation is to increase everyone’s mortgage rates.

Everyone – including economists, politicians, journalists and the general public – seems to blindly accept, without question, that constantly lifting interest rates is the thing to do when inflation is high.

I think there’s a strong case that the conventional wisdom – if indeed it is wisdom – is questionable in the current circumstances and that Australian families are being slugged with massively higher dwelling costs for no good reason.

There are other, better, ways to deal with the key components of the current high inflation rate and that higher interest rates are not having the forecast effect.

The biggest trend currently evident across Australia is that buyers increasingly are chasing affordability.

In most of our capital cities, it’s the affordable suburbs where buyer demand continues to be strongest.

And, at the same time, investors continue to buy in affordable regional locations that offer higher yields to compensate for rising interest rates.

It’s always a smart policy to take anything politicians say in an election campaign with a grain of salt and a heavy dose of scepticism.

But this is particularly so when politicians start making motherhood statements about housing affordability, about how much they care about it and what they will do about it.

Housing affordability has been a hot political issue for decades - but with each passing year it gets notably worse, despite all the promises made by a long line of politicians across all the states and territories.

The Sydney and Regional NSW markets are prime examples of why it pays not to generalise about real estate markets in Australia.

Generalisation and trivialisation by media is one of the chief causes of misinformation about our housing markets.

Sydney is usually discussed in media as a single market, as is Regional NSW, despite the size and diversity within those market jurisdictions.

Regional Australia continued to outperform the capital cities in 2022, with dwelling values rising marginally last year in the Combined Regions, compared to a 6.9% decline in the Combined Capitals.

That’s according to data published by CoreLogic early in January. It shows that the Combined Regions recorded a 0.1% increase in dwelling values in 2022 (which means, essentially, no change), helped by a 2.2% increase in regional apartment markets.

Across the house markets, the Combined Regions fell just 0.2% (also, essentially, no change) while the Combined Capitals decreased 7.4%.

Overall, the results for 2022 have been a lot more positive, with growth locations outnumbering declining ones.

More and more credible analysts are suggesting that residential property prices will grow in 2023.

At Hotspotting we certainly believe that most locations will deliver some level of price growth in the coming year.

So, how to determine the best places to focus your attention, to take advantage of the growth that’s coming to Australian real estate?

Many of the answers lie in the pages of Hotspotting’s two most popular reports, which are being published now to provide guidance on where you’re likely to find growth.

Our new 2023 edition of National Top 10 Best Buys has just been published and so too has the Summer 2022-23 edition of The Price Predictor Index.

These two very different reports use different methodologies to pinpoint locations poised for growth in the near future.

If you read both, you’ll be well-placed to make good choices on locations to buy in 2023.

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There’s a lot of media speculation around about the downturn in what economists call “the Australian property market”, with doomsday predictions for house prices in 2023 - but when you look at the actual data, that’s far from the reality.

There continue to be growth markets right across the country, as well as some which have been in decline since 2021 – long before interest rates started to rise.

For the Summer 2022-23 edition of The Price Predictor Index report, we analysed thousands of housing markets throughout Australia to determine the patterns with sales activity, which means buyer demand.

We do this because sales volumes are a forward indicator of what will happen with prices.

Rising transaction levels are usually a precursor to property price growth.

Equally, if sales activity is falling, price growth will slow, or stop – or prices may fall.

Across Australia, there are over 800 towns and suburbs where sales activity is rising and hundreds of others with consistent market performance.

Residential rents in capital city Australia are 24% higher than a year ago, according to the latest Rents Index from SQM Research.

Five of the eight capital cities have recorded annual growth of 20% or more in their rents, headed by Sydney which is up 28%.

Close behind is Melbourne which is up 24%, Brisbane 23% and both Perth and Adelaide where residential rents have increased 20%.

Canberra, Hobart and Darwin have recorded more moderate increases in rents, according to the SQM index.

The figures provide further evidence of the impact of record low vacancy rates across Australia – and the difficulties facing residential tenants around the country.

The key thing that Australian consumers need to know about property prices is that the state of play depends on whose figures you read.

Media reports CoreLogic data most of the time and tends to treat it as gospel truth – and never acknowledges the reality that there are other credible sources of price information which often disagree with the CoreLogic figures.

CoreLogic is undoubtedly the most negative of the price data sources, which may be why journalists favour their figures. That company’s tendency to focus on the negatives certainly suits the narrative that most media outlets prefer.

But other reputable sources of property data have figures that conflict with CoreLogic’s, a fact that should be highlighted more than it is.

There is a growing chorus of reputable real estate analysts who are forecasting that residential property prices will rise in 2023.

In contrast to the predictions of economists working for the big banks and other institutions, specialist real estate researchers see prices growing in the year ahead.

No one is forecasting price rises like we saw in 2021, when the national average was an increase above 25%.

Rather, most credible analysts are suggesting price growth that could be described as solid or moderate.

That’s certainly how we see it at Hotspotting.

If Australia follows the advice of the Greens, it will end up like Ireland.

I don’t mean full of history, incredibly green hills and wonderful hospitality, but facing a rental crisis like nowhere else on the planet.

In Australia we have the greatest rental shortage ever recorded, but it pales in comparison to the situation in Ireland.

The key question is this: how did Ireland get into such a parlous situation with virtually nowhere for people to live as tenants?

The answer is: they implemented government policies very similar to those the Greens want to have legislated here in Australia.

Australian consumers with an interest in real estate have been drowning, lately, in forecasts about big future decreases in real estate values – from the people I call the usual suspects, who have such bad track records in predicting property prices outcomes.

So it’s refreshing to see a high-profile and credible figure actually predicting that property prices will rise in 2023 – and getting considerable media coverage for it.

I’m already on the public record in forecasting growth in house prices in 2023, as is the highly respected analyst Simon Pressley from Propertyology.

And now Louis Christopher of SQM Research has published his annual Housing Boom and Bust report, which broadly forecasts a recovery in property prices in the major cities of Australia.

For several years now, regional markets have been out-performing capital city markets on buyer demand and price growth.

According to the data from many different research sources, the regions have been the big achievers in Australian residential property.

The trend we call The Exodus to Affordable Lifestyle has been under way for much of the past decade and this has been reflected in price data for several years.

In 2020, the combined capital cities rose less than 3% while the combined regions increased more than 7%.
In 2021, the combined capital cities rose 23% but the combined regions rose 26%.
In 2022 to date, the capital cities have dropped 3.2% but the regions have risen 6.4%.

One of locations which has been at the forefront of this trend of out-performance by markets outside of the big cities, has been Regional Victoria.

Our new Top 5 Victoria Regional Hotspots report is essential reading for anyone planning their investment decisions, as it provides research-based evidence of the markets we expect to do well through 2023 and beyond.

The Governor of the Reserve Bank Philip Lowe has apologised to the nation.

In particular, he has apologised to all those Australians who believed his forecasts about interest rates and went out and borrowed to buy homes and investment properties, in the expectation that mortgage rates would not be rising in the near future.

As apologies go, this is a particularly empty one.

Perth has shown strong resistance to downturn pressures as it maintains high levels of sales activity and good price growth.

In contrast to trends in the biggest cities, Perth has delivered strong levels of sales volumes in recent quarters, despite all the disruption from interest rate rises, high inflation figures and all that ridiculously negative media.

In our latest quarterly survey, most of the suburbs in the Greater Perth area are categorised as rising or consistency markets.

This means the Perth market has been consistently strong in every quarter over the past two years, with well over a hundred suburbs categorised as rising markets.

Overall, Perth has been become one of the biggest targets for investors across Australia because the local economy is strong, the population is growing, real estate is cheap relative to other cities and the growth prospects are attractive.

Although media reports CoreLogic data as if it’s the only source available – and the gospel truth – there are other reputable, credible sources whose figures are somewhat different.

CoreLogic claims that prices fell everywhere in October but other research sources like PropTrack and SQM Research disagree.

In the latest data on prices from SQM Research, house prices have risen nationally 2.5% in the past month, according to the SQM Prices Index.

Regional markets, overall, continue to be stronger than the cities, but the capitals are doing well also.

Andrew Courtney of Plenitude Wealth is an acknowledged expert on "The Doubling Game".
He explains it like this: "If you start off with $1,000 and double it 10 times you get to $1 million. Double it 10 more times you get to $1 billion. In other words, if you could double your net assets 20 times you would be a billionaire."

Courtney joined Hotspotting founder Terry Ryder on Wednesday 9 November to explain how "The Doubling Game" works and how real estate investment can accelerate the process.

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Achieving this level of wealth is impossible unless you're an investor.
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Few markets across Australia have better prospects for growth than Brisbane’s.

It has all the major ingredients for upward movement in values, including strength in the underlying economy, a high level of spending on infrastructure and the biggest population boost from internal migration of anywhere in Australia.

It is one of the nation’s leading beneficiaries from the Exodus to Affordable Lifestyle trend and it has the prospect of significant economic and real estate uplift from the impact of the 2032 Olympic and Paralympic Games.

Further confidence comes from the ranking of Queensland as the nation’s second strongest economy in the October 2022 edition of The States of the States report published by CommSec. In this report, Queensland ranks No.1 on population growth and on employment.

Discover the strongest growth prospects in the newTop 5 Brisbane Hotspots 2022-23 edition report out now.

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If you’re someone who tunes into mainstream media, you can be forgiven for thinking they fell for the sixth consecutive month – because that’s what many media outlets have reported.

But this is because of the tendency by journalists to use the data published by CoreLogic, an organisation driven by a desire to generate media sensation, rather than a desire to provide quality information to consumers.

Others research entities – and I mean credible, reputable sources of price information – disagree with the CoreLogic claim that the national average in October was a further decline in house prices.

Both PropTrack and SQM Research have published data which contradicts the figures from CoreLogic.

And I think it’s important for consumers to be aware that there are alternative views about price trends which need to heard.

Because both PropTrack and SQM record significant instances of house prices rising during October.

Regional Queensland is a natural consideration for property investors because many of its cities offer attractive affordability and good yields within the nation’s leading population growth state.
The market’s appeal was temporarily curtailed by plans from the Queensland Government to introduce an onerous land tax policy, causing investors to shelve plans to buy in the state.
However, more recently the State Government has been forced to admit that its tax proposal was unworkable.
Since the announcement that the land tax plan was being scrapped, investors have put Regional Queensland back on the agenda.
Many of the state’s regional centres are ideal targets for property investors because they offer low prices and high yields, supported by ultra low vacancies, at a time of rising interest rates.
They also present good prospects for future growth, underpinned by strong local economies and big spending on infrastructure.

Discover our top picks for regional Queensland investment in our new Top 5 Regional Queensland Hotspots report.
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Many of the economists making forecasts about property are claiming that house prices will fall next year, but I’m convinced prices overall will rise in 2023.

Those economists, I should point out, are the usual suspects who have terrible track records in forecasting real estate outcomes, partly or largely because they think that interest rates are the only factor in play.

It’s kindergarten analysis by the same people who early in 2020 forecast a property crash and what we got instead was a property boom.

We like to think that we’re more knowledgeable and sophisticated here at Hotspotting.

So our forecast for next year is that, overall, property prices will rise – not everywhere, of course, and not by the same level of growth across the nation – because we don’t have a single market in Australia.

You can be forgiven for believing that the Reserve Bank of Australia is expecting, and is predicting, that our house prices will drop 20%.

After all, that’s what media is telling us, constantly, of late.

Many news media outlets have stated, categorically, that the RBA has forecast a 20% drop in prices.

In fact, many journalists have gone a step forward and stated that house prices WILL fall 20% - without any possibility of it not happening – because the Reserve Bank says so.

But here’s the thing: it’s a lie. The Reserve Bank has not made that forecast.

There have been big headlines around Australian in the wake of the new Federal Government’s first Budget.

They’re going to build a million new homes in five years to solve the housing shortage crisis.

There’s been widespread – although not universal – applause, because it looks and sounds great at first glance.

And, as you can imagine, the organisations that represent builders and developers are expressing considerable glee. No surprise there – it sounds like a windfall for them.

But that’s at first glance.

At second and third glance, it looks to me like a spectacular failure by the new Federal Government and by Treasurer Jim Chalmers, who is Federal Labor’s bright-eyed boy and no doubt their future leader.

It’s a spectacular failure because it shows that the Government does not understand the real issues here, how the problems were created and where the genuine solutions lie.

It’s easy to get the impression that prices are falling everywhere, because media provides very shallow and generalised analysis of what’s happening in property markets.

When you dig a little deeper and look behind the generalised figures, you find that there are markets within markets.

And the reality right now is that the Top End of our big city markets is the sector that is falling – and it’s dragging down the general median price figures for Sydney, Melbourne and Brisbane, creating the impression that prices are falling across the board.

They’re not – it’s the millionaire suburbs that are dropping while the affordable markets, where most people live, continue to perform well.

My prediction for real estate prices in the next 12 months is very different to the ones being published by mainstream media.

While there are forecasts from the usual suspects – mostly economists with poor track records in forecasting – that prices will fall 15% or 20%, my prediction is that property prices will rise in the next 12 months.

For a long time now there has been a serious disconnect between what’s happening in real estate markets in Australia and what mainstream media says is happening in Australian real estate.

But right now, that gap between media perceptions and reality is greater than ever before.

My view, very strongly, is that now is a time of great opportunity for property investors in Australia.

In many locations, the heat has come out of the market, so that investors can buy with less competition and urgency, meaning there are prospects to buy at better prices than a year ago.

At the same time, vacancies right across Australia are the lowest ever recorded and rents are rising faster than I have seen in my four decades of researching real estate.

There is a serious shortage of homes in Australia and all the projections suggest it will get worse before it gets better.

This means there is an accumulation of factors likely to create price growth in the near future and in the longer-term.

While much of the mainstream media commentary on the property market focuses on the highs and lows of the big capital cities, it’s Australia’s smaller capital cities which have really shone in the past two years – and they continue to do so.

Adelaide, in particular, is one of those shining stars.

Overall, Adelaide is a story of continuing high sales activity and on-going price growth, remaining generally one of the strongest markets in the country.

Our recent analysis of sales volumes across Australia shows that Adelaide has a large number of suburbs with rising sales activity and there is no evidence that it will experience a downturn anytime soon – in contrast to media rhetoric about markets declining everywhere.

As Covid lockdowns become a distant memory and life seems to be getting back to some level of normal, many in the media have begun to speculate that the trend I call the Exodus to Affordable Lifestyle trend will come to an end.

They believe that employers will demand staff return to offices, and that living and working remotely will became a thing of the past as everyone moves back to the cities and suburbs.

They won’t.

And the reason they won’t is that the Exodus to Affordable Lifestyle is not a response to Covid - it started long before that.

It’s a long-term trend and it’s here to stay.

As a research analyst on Australian housing markets, and a strong advocate of residential real estate as an investment, I always feel more optimistic when we are in periods of economic disruption – as we are right now.

Recent share market collapses have reinforced once again the relative safety of bricks and mortar - and provided a reminder that real estate often thrives in times of widespread economic disruption.

Recently Australian shares dropped to their lowest levels in months. Although many of those losses have since rebounded, we are undoubtedly in a period of volatility in share markets in Australia and worldwide.

Asian and US markets are going through periods of volatility as fears emerge of a looming recession.

While that’s not good news for those who have shares, it causes me to feel more optimistic about the future of real estate.

Here’s what passes for analysis in Australian real estate: if Event A coincides with Event B, then Event A must have caused Event B.

This is what I call kindergarten analysis and we get a lot of it in the housing market.

It ignores the reality that there is also Event C, D, E , F and G taking place – and some of those may have had an influence on causing Event A.

The worst example of this shallow analysis is playing out in mainstream media every day at the moment.

Event A is rising interest rates.

Event B is that prices, apparently, are falling in some markets.

According to most economists and journalists, this surely must mean that rising interest rates have caused prices to fall – even though that has never happened before in past property cycles.

Property markets are always evolving and reacting to changes in the economic climate – and the biggest trend currently evident across Australia is that buyers increasing are chasing affordability.

In most of our capital cities, it’s the affordable suburbs where buyer demand continues to be strong. And, at the same time, investors continue to buy in affordable regional locations that offer higher yields to compensate for rising interest rates.

Our quarterly analysis of sales activity for The Price Predictor Index shows there are still many supercharged suburbs and towns with increasing numbers of dwelling sales which will most likely to deliver future price growth - and the majority of these are affordable suburbs.

Find out our top picks nationwide in the Cheapies with Prospects Bundle

There’s a lot of media speculation around about the downturn in what economists call “the Australian property market”, with doomsday predictions for house prices - but when you look at the actual data, that’s far from the reality.
There continue to be growth markets right across the country, as well as some which have been in decline since last year
For the Spring edition of The Price Predictor Index report, we analysed thousands of housing markets throughout Australia to determine the patterns with sales activity, which means buyer demand.

Find out more in the new Spring 2022 edition of the Price Predictor Index. Out Now!

The greatest source of misinformation about real estate – and the scourge of consumers trying to figure out what’s happening in markets across Australia – is generalisation.

And by that I mean, economists and other commentators speaking about Australia as a single market or about a major city as if there is just one scenario happening across the entire metropolitan area.

The Spring edition of The Price Predictor Index depicts a number of important instances where it pays NOT to generalise – because there are markets within markets.

The nationwide rental shortage crisis may appear to be a Covid phenomenon, but it’s something many in the property investment arena saw building for a long time.

Years of constant changes to real estate investment regulations and taxes have pushed many investors out of the market, with the current shortage of properties for tenants the result.

All the core problems confronting the housing market can be blamed on politicians.

Whether it’s the housing affordability issue, the rental shortage or builders going broke in the middle of a construction boom, the short-sighted decisions of politicians are the underlying cause.

Media, economists and banks love to predict disasters for the property market - but it's astounding how consistently they are wrong.
Here are some (incorrect) predictions from the last couple of years.

Right now, many property investors are seeking locations with above average rental yields.

Buying properties that offer a positive cashflow situation is always a good idea, in my view, provided the location has the credentials for long-term growth.

But now more and more investors are looking for superior rental yields – because interest rates are rising, and may rise further.

Finding those positive cashflow scenarios has become harder, not only because borrowing costs are rising, but also because recent strong price growth has pushed down yields.

This may encourage some investors to consider real estate in high-risk locations that offer rental yields of, say, seven or eight percent.

But that’s not the way to go, because these kinds of locations often usually resources-related places and they tend to be boom-bust markets and therefore very risky.

So here’s my idea of the correct mindset to bring to this situation – offering a strategy that can deliver above average capital growth potential, safely, as well as the level of yield needed to cover the costs of ownership.

The idea is this: don’t consider a property only on the initial yield it offers.

Real estate markets across Australia remain busy, with solid price outcomes, with a couple of notable exceptions.

While media headlines have suggested that market decline and falling prices are widespread, our research shows this is not the case.

Our latest quarterly analysis of sales activity shows that most capital cities and most major regional markets continue to deliver busy markets with little evidence of price decline.

Our examination of all the price data that’s available from multiple research sources indicates that there are actually very few markets where prices are falling.

Most market jurisdictions still have rising prices, though not at the same rates of growth as in 2021.

The most important and relevant data for property investors relates to vacancy rates and rental growth – and these are the strongest we have observed.

Now is a time of rare opportunity for investors who have the ability to think and act independently. After several years of highly competitive markets and stellar price growth, the air has cleared for investors seeking strategic opportunities. While prices are still growing in many key markets across Australia, the frenzy has eased in most locations. Investors can buy well without the heat of intense competition. This occurs at a time when vacancies are at record lows and rental increases are compensating for higher interest rates. It’s a healthy alignment of positive factors for smart investors who can tune out the media white noise. The key factor for investors is to choose product and location well. On Wednesday 24 August, Hotspotting founder Terry Ryder spoke with renowned property investment expert Tim Graham from Reventon to discuss how investors can seize the opportunities presented by the new circumstances.

I am increasingly astounded by the lack of awareness by the nation’s politicians of the greatest issue in the housing market today – the rental shortage crisis.

AND the way state and federal politicians are making decisions almost daily which will make the situation even worse.

At the recent federal election, there was no discussion about the dire shortage of places for renters to live and none of the major parties put forward any policies to deal with it.

I think it’s safe to assume that this is because they were unaware that there’s even a problem to be dealt with.

The rental shortage has been building for years and now, somewhat belatedly, media has realised there’s a story here.

So now there are major articles every day with strident headlines describing desperate people sleeping in cars and living in tents because they can’t find anywhere to live – right across Australia.

Yet, despite the appearance of these startling stories day after day, politicians at all levels of government are apparently still unaware there’s a problem.

Rumours of the death of the Melbourne market have been greatly exaggerated.

While media is full of feverish headlines and soundbites about falling demand and collapsing prices, our research proves it simply isn’t so.

The Melbourne market is renowned for its resilience in tough times and our latest quarterly survey has confirmed it, with busy sales activity and solid price outcomes – particularly in the cheaper markets.

Our Spring 2022 quarterly survey has found 193 suburbs with persistently good sales activity – only 1 less than in our Winter Survey 3 months ago. This is despite the disruption of rising interest rates, cost-of-living pressures and persistently negative media.

That so many Melbourne locations have been able to maintain forward momentum, despite all the negative forces, is testimony to the strength of the city, which was named as the nation’s No.1 growth economy in the July 2022 edition of the State of the States report by CommSec.

Whether it’s the cheaper outer ring areas, the popular middle Melbourne suburbs or the inner-city apartment precincts, there’s still plenty of life in the Melbourne property market, so grab your copy of the new edition of Top 5 Melbourne Hotspots, which feature the best prospects in this consistent market.

Credible analysts, increasingly, are making forecasts for Australian property prices which contradict the sensationalist and alarmist predictions we have seen from media in recent months.

More and more sensible commentators are suggesting that any post-boom correction in residential property prices will be moderate and that many locations will continue to deliver solid growth.

They are also commenting that the general media theme that rising interest rates cause property markets to collapse is unreasonable and not based on historical precedents.

Regional Victoria is “the market that refuses to give up”.

Regional Victoria has been a national leader of the Exodus to Affordable Lifestyle trend and continues to draw residents out of Melbourne.

The key regional cities of Victoria have been notable growth markets for the past 4-5 years – but, amid all the disruption that’s currently afflicting real estate markets, they keep on keeping on.

The strong sales activity seen in the March Quarter continued in the June Quarter, despite rising interest rates and cost-of-living pressures.

Overall, activity in key centres across Regional Victoria remains busy and prices are still rising in most of these markets.

Whatever mainstream media says about markets crashing in various parts of Australia, it’s certainly NOT happening in Regional Victoria.

Our new Top 5 Victoria Regional Hotspots report is essential reading for anyone planning their investment decisions, as it provides research-based evidence of the markets we expect to do well through 2022 and beyond.

Investors who own properties in Queensland as well as other states are set to be slugged with massive land tax bills following the introduction of a new tax regime in Queensland.

New legislation was passed on June 24, which allows the Queensland Government to include the value of investment properties owned in other states when working out how much land tax to charge on Queensland properties.

Now, this is outrageous and I’m surprised it’s even legal, but the State Government in Queensland, which has become renowned for its shady dealings, has tried to justify it with political double-speak.

While media obsesses over speculation about property prices, a far bigger issue for residential property is the extraordinary shortage of rental properties.

I have been researching real estate for 40 years and I have never seen rental markets so tight in so many places.

Vacancies have been low for years but they keep falling and now all eight capital cities are well below 2%, with six of them between 0.4% and 0.8%. The national average is below 1%.

“Crisis” is an overused word in media but this truly is a crisis. Desperate individuals and families can’t find a rental home at any price and businesses can’t fill job vacancies because willing workers can’t find a place to live.

This has caused rents to rise in most locations across Australia, particularly in the past 12 months.

Perth is now a nation-leading market, showing strong resistance to downturn pressures as it maintains high levels of sales activity and good price growth.

In contrast to trends in the biggest cities, Perth has delivered strong levels of sales volumes in the latest quarter, despite all the disruption from interest rate rises, high inflation figures and all that ridiculously negative media.

Over the next ten years Australia is going to be THE focus of world attention for anyone with an interest in sport.
Between now and 2032 Australia will be hosting a series of sporting events of global significance – and, while it may not be immediately apparent, this has very major consequences for real estate investment.
Let me explain what I mean.

Firstly, here’s the line-up of global sporting events that will happening in Australia over the next 10 years:-
2023 FIFA Women’s World Cup – Australia and NZ
2026 Commonwealth Games - Regional Victoria
2027 Rugby World Cup (men) – throughout Australia
2029 Rugby World Cup (women) – throughout Australia
2032 Olympic Games – Brisbane and Queensland
Think about that for a moment.
Three world cups, a Commonwealth Games and an Olympic Games.
In the space of ten years.

Now, think about what that means for investment in infrastructure, for tourism, for economic activity, for employment and, as a consequence, for demand for real estate.

I’ve often said to people interested in real estate:
If you want a simple philosophy to guide your investing decisions – one that has been shown to work for investors over time - buy property that lies in the path of progress.
Another way of putting it is: follow the infrastructure trail.
Infrastructure spending is a very powerful factor when it comes to investing in residential property.

Our new Top 10 Infrastructure Hostpots report features locations where existing infrastructure development and future development will drive property growth.

Brisbane and SEQ lead the nation on population growth from internal migration – and there is a major infrastructure spend under way, with big ticket projects totalling around $30 billion under construction.

And there is more to come, because Brisbane and SEQ needs to invest in infrastructure to get ready for the 2032 Olympics.

This means that, while there will be ups and downs along the way, Brisbane will be a growth market for the next 10 years at least.

One of the most common investor questions at the moment is “Should I delay buying because prices might fall?”

This, I have to say, is the reaction of someone who has little knowledge, does little or no research, and simply reacts to media soundbites.

As I’ve often said in the past, the first thing real estate consumers need to do, is …

tune out all that media white noise,
avoid that constant source of negativity and misinformation, and
base your decisions on research and common sense.

It’s really important to think and act independently.

Unfortunately, most prospective investors don’t do a lot of research.

And they react to what they read and hear in mainstream media.

Essentially, they’re herd animals - and they join the stampede, whichever direction it happens to be running in.

While a lot of the discussion about the property market is focused on potential price drops and rising interest rates, the most important information for investors at the moment relates to vacancy rates and rents.

Rising rents mean most investors are well placed to cover any additional costs as a result of higher interest rates, because the rate of rental increases in the past 12 months has been exceptional.

This - coupled with the fact that most borrowers are well ahead on their repayments following years of low interest rates - means most investors will not struggle to service their mortgages.

The rental crisis throughout Australia is receiving a lot of media air time at the moment.

And that means many politicians are determined to be the person or party credited with finding a solution to the problem.

That’s a big concern for me, because every time politicians meddle with property markets with the excuse of providing a solution to things like housing affordability or the rental shortage, they generally make the problem worse.

At long last, we’re seeing the results of the 2021 Census being published by the ABS and there are some surprises on real estate matters.

Most people, I suspect, would have expected home ownership rates in Australia to have fallen over the five years since the previous Census – but they’ve actually improved a little.

In fact, there’s been little change in the rate of home ownership in the past 25 years.

This is perhaps a surprise given the constant steam of articles in mainstream media telling us that home ownership is effectively dead because no one can afford to buy.

The new Census data shows that it’s still the case that two-thirds of Australian households own their homes, either outright or with a mortgage.

While economists and media commentators are going out of their way to spread gloom about property prices, it appears most consumers have managed to tune out all that media white noise.

A colleague of mine describes it as “Doom Fatigue” and I think that encapsulates the public mood at the moment.

Australians are suffering from Doom Fatigue not just about the property market, but after years of the news bulletins being dominated by Covid, natural disasters and war in Europe, they just don’t want to know about it.

People are utterly sick of being bashed with bad news and as a result they are tuning it out.

Many people I know have simply stopped watching the evening news.

And I think this phenomenon of Doom Fatigue has extended to media forecasts on property prices.

Markets across Regional Queensland are operating at a high level, although some of the former stars like the Sunshine Coast are fading. Our latest quarterly survey has classified 177 locations as rising or consistency markets, which maintains the high levels we have recorded over the past 18 months. This means that, despite less vibrancy in major markets like the Sunshine Coast and the Gold Coast, Regional Queensland continues to present numerous strong property markets with high levels of sales activity. And our price analysis shows there continues to be exceptional value growth in many areas. Find out more in our latest Top 5 QLD Regional Hotspots report.

Many economists and media commentators are desperate to be the first to call the end of the boom and to predict that property prices will crash.

That’s why we’ve had widespread claims that the property boom is over, at different times, since the beginning of the last year – only to be proven wrong in each case by the publication of subsequent data.

As soon as there is any uncertainty or disruption in the Australian economy or the world, the doomsday forecasters come out of the woodwork telling us that it’s a prelude to property prices collapsing.

Right now, we have a cacophony of the usual suspects telling us prices will dive because there’s economic disruption from events both here and globally.

This sort of knee-jerk analysis is not based on any expertise, or research analysis, or even a simple examination of what has happened in the past during times of economic disruption.

So those doomsday forecasters will be, yet again, proven wrong.

A recurring theme in many markets around the nation is that the local growth leaders are the more affordable locations.

Our new Winter edition of The Price Predictor Index shows that Sydney overall is down, but many of its cheaper areas still have good demand.

Perth is buoyant, led by the affordable precincts.

It’s a similar story in Brisbane and Adelaide, with very strong buyer demand in the more affordable areas in particular.

And in Melbourne, where the millionaire precincts have shown evidence of decline, the most affordable LGAs still have lots of growth markets.

Find out more in the new Winter edition of the Price Predictor Index.

We’ve just published the new Winter edition of The Price Predictor Index and it shows that Western Australia, Queensland and South Australia are the key places where real estate consumers should be focusing their attention.

While this Winter 2022 survey of sales activity across Australia shows a marked decline in the Sydney market, we have identified Perth, Brisbane and Adelaide as the capital cities where sales activity remains strong and prices are tipped to keep rising.

The regional areas outside those three cities are also over-achievers.

Find out more nad get a copy of the report....

https://www.hotspotting.com.au/product/price-predictor-index/

If you’re someone who wants to understand what’s really going on in real estate markets around Australia, here’s the key thing you have to do:

When data on the property market is published, get a copy of the actual report.

Don’t read what the media says is in the report. Get a copy of the report itself.

In most cases, the reports – from research entities like Domain, SQM Research and CoreLogic - are free and easily accessible.

And when you look at the data in many of the reports on prices, you will notice the stark differences between what the reports say, and what the media claims the reports say.

The sad reality is that the key messages on property market data are being distorted in two main ways.

Despite daily media articles declaring that property prices are set to fall 15% or 20% or more, most Australians don’t believe it.

That’s according to the latest Finder Consumer Sentiment Tracker.

The Finder survey sought people’s views of what they expect to happen with house prices in the next 12 months - and very few, it seems, are expecting prices to fall.

Even in Sydney and Melbourne, where economists and commentators have declared prices to be falling already, only about 20% of consumers believe prices in their local area will fall in the next 12 months.

It seems to me that Australians are a lot smarter than the media thinks.

They know there’s a significant difference between what the data shows and what the media says it shows.

An easy way to see where future property price growth is going to occur – or not occur - is to look at transaction numbers.

When sales numbers lift, it means competition for properties is increasing, and what generally flows from that is price growth.

Sales activity numbers are a great forward indicator of what will happen with prices and is actually a much better barometer of what is about to happen in the market than looking at median house price data.

The figures on changes in median prices published by various research companies lag the market – they tell us what has happened, allegedly, in the recent past – but sales volumes provide clues about what will happen to prices in the near future.

One of the skills Australian politicians have mastered over the years is finding ways to raise ever more revenue from the housing industry, but pretending that any new measures they’re introducing are actually motivated by a desire to fix housing affordability or a housing shortage.

The latest shameless exercise by a government entity to do this has come from the Brisbane City Council, which rules over a large chunk of the Brisbane metropolitan area.

The Brisbane council, headed by Lord Mayor Adrian Schrinner, wants to raise some extra revenue from every politician’s favourite cash cow, the housing market.

And they want to dress it up as a measure to fix the housing shortage – because, Brisbane, like everywhere else in Australia, has a chronic shortage of residential rental properties.

Now the key to getting away from a cynical cash grab from the housing market is to not only pretend that you’re fixing a serious problem, like the housing shortage, but also to scapegoat an unpopular minority for the problem.

In Australian politics, when it comes to housing issues, the scapegoat of choice is always property investors.

So Brisbane City Council has decided to blame the rental shortage on property owners who have put their properties into the short-term rental pool, rather than the permanent rental pool.

Media keeps telling us that the trend I call the Exodus to Affordable Lifestyle was caused by Covid and that once the pandemic is dealt with the trend will reverse and everyone will move back to the big cities. Well, they certainly got that wrong.

The trend of people leaving the big cities and moving to the regions, or the smaller cities, has been under way for a long time.

This trend is not about the pandemic – it’s about technology allowing people to work remotely and it’s about accessing a better lifestyle at an affordable price.

It’s a long-term trend and it’s here to stay.

https://www.hotspotting.com.au/product/exodus-national-top-10/

With so many organisations analysing the property market, it can be hard to determine just who has the right reading on what is happening with prices across Australia.

And there is the distinct possibility that none of them is correct.

I recently did an online search for the median house price for a particular suburb and came up with six different figures from six different data sources.

The difference between the highest and lowest figures was more than $100,000 – the lowest was $628,000 and the highest was $737,000.

You can search any suburb or town in the nation and you will find similar results – huge differences in the numbers which purport to describe the median house price in any of those locations.

You will find a source that says prices are rising in a particular location and some which say prices are falling there.

It’s no wonder people are confused about what is happening.

The Adelaide market continues to operate at unprecedented levels and right now is arguably the busiest and most competitive market in capital city Australia.

It presents an attractive proposition for investors:-
- It remains one of the most affordable cities in the nation,
- its prices are growing faster than any other capital city,
- it has the lowest vacancy rate, and
- its rental growth is leading the nation.

Our new edition of Top 5 Adelaide Hotspots reveals the markets within the Adelaide metropolitan area that I expect to excel for the rest of 2022 and into the future.

After 18 months of stellar price growth pretty much everywhere in Australia, affordability is more of an issue now than ever before. And, as we head towards the Federal Election, it’s clear that the problem isn’t going to be solved any time soon, because none of the major parties have policies that will make the cost of housing cheaper.

There are policies that may make it easier for young buyers to get a loan to buy an expensive house or apartment, but nothing to address the high costs of creating dwellings in this country.

So this is an issue for all sorts of buyers, not just first-home buyers.

For the first time in a long time, there has been an improvement in residential vacancies in Australia.

But the change is miniscule.

The national vacancy rate, according to SQM Research, increased from 1% in March to 1.1% in April – which means that there continues to be a chronic shortage of residential rental properties around Australia.

What this means, of course, is that there is tremendous upward pressure on rents.

While a lot of media attention is focused on what is or isn’t happening with Sydney property prices, other parts of New South Wales continue to perform extremely well.
Late last year, along with the comparison website Canstar, I analysed the price growth prospects in all the major markets across Australia – the 8 capital cities and 6 state regional markets.I used a range of different metrics to determine the markets with the best prospects for price growth in 2022.

Of all those 14 market jurisdictions, Regional New South Wales come out on top as the No.1 ranked market in Australia.
And that ranking really should not surprise.

Significant changes have occurred in the Sydney property market in the early part of 2022, with a weakening at the top end of the market and a re-focus on locations and dwelling types that offer better affordability.

Most notable is the shift in focus to more affordable suburbs for houses and also an uplift in demand for locations with apartments at attractive prices.

There is strong buyer demand in precincts where houses are typically available in the price range from $900,000 to $1.5 million, and suburbs with median unit prices below the overall Sydney median of $830,000 (CoreLogic figures) – or, in some cases, slightly above it.

We expect this to be an ongoing feature of the Sydney market, with more buyers opting for apartments to achieve purchases in good locations at more affordable prices – in a city where the median house price is close to $1.5 million and many suburbs have median house prices above $1 million.

Against this backdrop, we have published our new edition of the Top 5 Sydney Hotspots report. It outlines five precincts which we think have good prospects for future capital growth in both the house and apartment markets.

https://www.hotspotting.com.au/product/top-5-sydney/

Here’s an interesting fact: if history repeats itself, rising interest rates will mean that property prices also will rise, not fall. In fact, if recent history does repeat, house prices will double during an extended period of multiple interest rate rises.

The Sydney market represents an opportunity for investors right now because the evidence suggests it’s less competitive than in 2021, so it’s becoming easier to buy well. And vacancy rates are dropping fast and rents are rising, a situation that will be enhanced by the re-opening of international borders and the return of overseas migrants and students.

Let’s look at the background …

Sydney is the one capital city in Australia where there is some evidence that its property market has passed its peak.

Property prices seem to be hitting a plateau but it’s still too early to make a definitive call on whether its growth has stopped.

Sales activity appears to have tapered off in the early part of 2022 and CoreLogic figures suggest there was a small decline in the past two months in median prices for apartments and houses.

But there are many factors at play and it’s too soon to make a definitive call on where prices in Sydney might go for the remainder of 2022 and beyond.

The key message for Australians interested in what’s REALLY going on in property markets across the nation is this: Don’t believe everything you read about how Australian property prices are faring at the moment.

In fact, I would go so far as to say: don’t believe ANYTHING you read about property prices across Australia.

You may have seen a lot of commentary about how prices are already on the way down across Australia – but, for the most part, that is simply NOT the case.

There’s a concerning trend emerging where people are relying TOO much on the monthly property price data - from one high-profile source - as an accurate indication of what is happening in property markets – and what WILL happen in property markets. Too many people take this short-term price data as the gospel truth and allow it to dictate their decisions on WHETHER they will buy real estate and WHERE they will buy it. Australian consumers need to understand this simple truth – all real estate data is, to some extent at least, dodgy data. They’re all rubbery figures and you cannot take them too literally. You certainly should not make big assumptions – or big decisions - based on one month’s figures from one source. And you need to be aware that the emphasis featured in news media is quite different from what the actual figures show.

While there are some early signs that, maybe, Sydney and Melbourne markets are starting to moderate, all the evidence suggests that the opposite is happening in many other markets across Australia, including Perth.

The Perth market is undoubtedly the strongest it’s been since the end of that big resources investment boom almost 10 years ago.

After several years of downturn, the Perth market moved into recovery mode in 2020 and then became considerably stronger in 2021.

All the indications suggest that 2022 will be a boom year.

Mainstream media tends to present CoreLogic price data as the definitive view on real estate prices – indeed, the only view.

So when CoreLogic says house prices fell (slightly) in Sydney and Melbourne in March, media presented that as fact.

But it’s not fact. It’s simply the world according to one research source.

There are other credible, reputable research entities in Australia, including Domain, SQM Research and the ABS.

And often their data contradicts the CoreLogic figures.

It is important for real estate consumers to be aware that there are different stories being portrayed by the research figures, depending on where you source your data.

And, in the final analysis, it doesn’t really matter which is more accurate. Because both are depicting what recently happened – allegedly – with property prices.

And that does not inform the future.

In real estate investment, it’s the future that matters, not the recent past.

The media headlines might be shouting that the property price boom in Australia is over, but the numbers tell me otherwise. According to the latest CoreLogic figures, the national rate of growth in dwelling values actually rose in March – slightly – compared to February.

The best advice I can give you is to tune out all the white noise in mainstream media and do some real research.

Don’t read the media reports – get a copy of the CoreLogic report, which is free, and look at what the numbers actually say, free of the media misinformation.

How will the Melbourne market perform in 2022, free of lockdowns and with major new factors in play, including the opening of international borders?

I expect Melbourne to have a strong year in real estate in 2022.

Last year, Melbourne did well, despite being the most locked-down city in the world.

Despite all the restrictions, Melbourne produced strong price growth, particularly for houses.

Opening of international borders means that overseas migrants and foreign students can return – and this, I believe, will have a big impact on the Melbourne market in the near future.

THE Prime Minister may like to say he is helping those who can’t find a place to rent by helping Australians BUY a property, but from my point of view both the Federal Government and the Federal Opposition are yet to grasp just how enormous the rental crisis is in Australia.

There has been nothing in recent weeks which shows me that any of our Federal Politicians have any awareness of just how big a problem it is for everyday Australians.

Neither of the major parties has announced anything to support those many Australians caught up in the rental crisis and in fact there has been very little to address housing affordability in a meaningful way either.

Yes, there was the announcement that the Home Loan Deposit scheme would be expanded for three years to make it a little easier for First Home Buyers to get into the market, once they have saved a deposit of 5%, but that still doesn’t do anything about the ever-growing cost of housing.

Some analysts claim it makes it worse.

Regional Victoria was one of the first areas in Australia to really exhibit clearly the pattern that has become the major property trend of the 21st Century – what I like to call the Exodus to Affordable Lifestyle. I expect this trend to continue for some time to come – it won’t stop once the pandemic is dealt with – because this is fundamentally about technology, affordability and lifestyle.
Regional Victoria as a whole is still a very strong market, which has produced outstanding price growth in the past 12 months, with many locations rising 20% and some above 30%.
In our Autumn prices survey, of the 142 regional Victorian locations analysed, 140 have recorded growth in their median house prices in the past year, and 141 have had growth in the most recent quarter.
Regional Victoria is still a market which has a lot further to go, particularly as I don’t see the Exodus trend easing any time soon.

The secret to investing in property is to do your research and be fully informed. To that end many people planning to buy an investment property buy one or two of our Hotspot reports.

For example, if they are thinking of buying in Victoria, they might purchase the Top 5 Melbourne Hotspots report or the Top 5 Regional Victoria Hotspots report.

Investors keen to buy in Queensland will be interested in the Top 5 Brisbane Hotspots report or the Top 5 Regional Queensland Hotspots report – or both.

But some people treat property investment as a long-term enterprise, with a strategy of buying regularly over the next 5 or 10 years or more.

They don’t intend to stop at one investment property – they want to build a substantial portfolio over time.

Those are the investors who like to get all of our reports.

Find out more about Hotspotting Premium Membership

If you want a simple philosophy to guide your investing decisions – one that has been shown to work for investors over time - buy property that lies in the path of progress. Another way of putting it is: follow the infrastructure trail. Infrastructure spending is a very powerful factor when it comes to investing in residential property.

It’s one of the key elements we look for in areas we’re comfortable to recommend to our investor clients.

We have created a national report to highlight the locations best situated to receive real estate growth from this compelling national trend.

The Infrastructure Led Economic Recovery National Top Ten report identifies the areas where big infrastructure projects are under construction or in planning - which allows investors to get in front of the trend.

Get Your Copy Now

I’ve heard some pretty crazy predictions about what will happen to the property market in the 40 years I’ve been researching and writing about real estate - but I reckon I heard the craziest one this week. I shouldn’t really be surprised considering where it came from. AMP Capital economist Shane Oliver loves to dabble in areas where he’s not an expert, including property market forecasting – and over the years he’s made some bizarre statements and got it horribly wrong more often than any other high-profile commentator.

But this time he’s exceeded even his own wacky standards – he’s predicted that the war in Ukraine could result in Australian housing prices dropping by up to 15%.

If this concerns you at all, I can tell you it won’t happen.

One of the best indicators of future property price growth – or decline – in a specific location is the pattern with transaction levels in the area.

Every three months we analyse property sales activity in every significant suburb and town throughout Australia for the quarterly editions of The Price Predictor index and this analysis reveals the locations where prices are likely to fall or stagnate or decline.

Sales volumes are always a good indication of future property price movements.

When sales numbers rise steadily over consecutive quarters, prices inevitably will rise. Fortunately, there is a time lag between a change in market activity and major impact on prices, and this allows investors who spot the trend to buy ahead of the price growth.

Conversely, if there is a steady quarter by quarter decline in sales activity in a location, price growth is likely to falter and in some cases prices may decrease.

This analysis forms the basis on The Price Predictor Index report which I regard as our most important report.

Residential rents continue to rise as vacancy rates fall further right across Australia, both in the capital cities and in the regional areas.

The best source of information on vacancy rates comes from SQM Research and their managing director Louis Christopher says vacancy rates in six of our capital cities are below 1% and they’re around 2% in both Sydney and Melbourne.

In most regional market, vacancies are well under 1% - and in some places they’re closer to zero than to 1%.

Now, keep in mind that accepted benchmark for a balanced rental market is a vacancy rate of 3% and anything under 3% represents a shortage.

Right now there’s a rental shortage crisis almost everywhere in Australia.

Demand for Queensland real estate from interstate buyers have never been higher, as more and more people seek out homes in areas that provide lifestyle at affordable prices. Investors are also focusing on Queensland because, in addition to its lifestyle attractions, it also offers good rental yields and strong prospects for capital growth. Find out more in our QLD Hotspots Bundle

There has been a lot of discussion recently about what affect the floods in South East Queensland and along the east coast of NSW will have on the property markets that have been affected by the extraordinary rain bomb. Certainly, there will be an impact felt but will it be enough to knock booming property markets off their upward trajectory long term? I don’t think so – for reasons I will explain.

Investors feel more comfortable buying in their own backyard. They feel they understand their local market and it’s easier to inspect and check things out.

Buying interstate is more challenging. It presents the problems of how to research an unfamiliar market and how to check everything from a distance.

Those problems are multiplied when the market is hot and properties are selling fast, often for higher-than-expected prices.

That’s where a good buyers’ agent comes in.

Now, more than ever before, investors need a trusted advocate on their team.

On Wednesday 9 March, national buyers’ agent Alex Dutt from Adviseable joined Hotspotting founder Terry Ryder to discuss the issues of buying from a distance in a boom market.

Dutt and Ryder discussed …

How and where to find excellent buys in a seemingly rampant market
How to avoid the FOMO and hype trap
How to make sure you don’t overpay
Getting yourself to the front of the buyer queue as an interstate investor
Current case studies

What do governments do when they decide they need to raise a bit of revenue? They introduce a new tax. And if it’s a Government in Australia we all know what that means – another property tax.

It’s the Victorian Government this time, which has introduced yet another new tax on the housing industry.

Another impost which just makes the cost of new housing even more expensive for the end use – which often means first-home buyers.

Our national obsession has taken a break from sport and focused on the one thing many home buyers worry about but have little control over – interest rates. Media is not content to let us enjoy the benefits of historically low interest rates or listen to the Reserve Bank Governor when he says rates are not going to increase any time soon. Instead, day after day, week after week, month after month, we have to endure this endless speculation that interest rates are going to rise and, as a result, property prices will crash.

The speculation is driving everyone crazy, and I can understand why.

The endless commentary about when interest rates are going to rise and what it will do to the market are just that, it’s commentary.

It’s pure speculation, not news of substance.

Property investment outcomes don’t get much better than this.

You sign a contract to have a house built and before the house is completed its market value is 15% or 20% higher than the cost of the house-and-land package.

Property investment specialist Danny Buxton of Triple Zero Property Group says scenarios like this are far from exceptional in the current market climate.

The exceptional examples are where the house, on completion of construction, is worth 30% more than the cost to the investor.

Buxton says there are numerous current examples of this in nation-leading growth markets like South-East Queensland and Adelaide.

On Wednesday 23 February, Buxton joined Hotspotting founder Terry Ryder to discuss this method of investment in detail.

Buxton outlines …

How investors can achieve strong growth even before their new build is completed
Where to find the best locations for this style of investment
How to ensure the best outcomes with new-build investments
The challenges investors can face in the current climate of shortages and rising costs.

I’ve said many times that people should ignore what bank economists say when they decide to dip their toe into property market analysis – a subject which is outside their area of expertise. In fact, you should completely ignore them when it comes to forecasting what is going to happen to house prices, as they usually get it wrong – indeed very wrong – and often the eventual outcome is the opposite to what the bank economists predicted. But, having said that, there is one piece of regular research put out by the major banks which I believe is a must-read for property investors.

The State of the States report, published quarterly by CommSec, which is a division of the Commonwealth Bank, provides good analysis of what is happening in the Australian economy and I believe is a great indicator of where you might want to consider investing in real estate.

Perhaps the worst property forecast report published each year is the NAB Residential Property Survey. NAB publishes its survey results every February, presenting forecasts for what it says property prices will do in the year ahead. The latest report, published in the past week, has attracted massive media coverage across Australia, particularly because the report is forecasting a 9-10% decline in property prices next year.

In our day-to-day research at Hotspotting, we’ve seen all the articles written about this report.

And I have to say it’s a damning indictment on the standard of journalists in Australia. Every one of the dozens of journalists who wrote an article on this NAB report simply presented the information in the NAB press release.

Media keeps telling us that the trend I call the Exodus to Affordable Lifestyle was caused by Covid and that once the pandemic is dealt with the trend will reverse and everyone will move back to the big cities. That’s wrong on so many different levels it’s difficult to know where to start.

The trend of people leaving the big cities and moving to the regions or the smaller cities has been under way for a long time.

Sydney has been losing population to internal migration for over 10 years and Melbourne has been losing population to people moving to other parts of Victoria for the past 5 years.

This trend is not about the pandemic – it’s about technology allowing people to work remotely and it’s about accessing a better lifestyle at an affordable price.

It’s a long-term trend and it’s here to stay.

The smaller capital cities and some of the key regional areas are leading the strong price growth that continues to sweep across Australia. The February report on prices from CoreLogic shows that eight of the nation’s 15 major market jurisdictions (eight capitals and seven regional markets) recorded house price growth of 1.8% or more during January.

When politicians want to give the impression of doing something, while changing nothing, they bring on an inquiry – or, even better, a royal commission. The latest inquiry created in the Federal Parliament is about housing affordability and supply in Australia.

It’s perhaps not as hated or understood as that most insidious of property charges, stamp duty, but ever since it was introduced in Australia almost 140 years ago, land tax has become just as big a cash cow for State Governments.

Its initial aim – back in the 19th Century - was as a sort of wealth tax to encourage the owners of large holdings of land to break them up and sell them off.

While that had the desired effect way back then, the other thing it showed the Government of the day was that land tax was something which could help fill their coffers and they really had to give nothing in return.

So, more than a century after it served its purpose and should have been scrapped, we still have this insidious tax which afflicts investors for no particular reason.

It seems that, even when it has outgrown its original purpose, once we get a tax in Australia the chances of getting rid of it are negligible.

As if that wasn’t bad enough, now we have the Queensland Government announcing that it will further penalise property investors by dragging interstate owners into its land tax regime.

It’s a rare market indeed when an 18% rise in prices is seen as under-achieving.

Melbourne’s median house price rose 18% in 2021 (CoreLogic figures). This was a commendable result in a year in which Melbourne was dubbed as “the most locked-down city in the world”- but it under-performed relative to the national average rise of 24.5%.

This begs the question: what can Melbourne achieve in the coming year free of lockdowns and with international borders open, bringing back the considerable impact of overseas migrants and foreign students?

Regional Victoria has been a national leader on price growth for several years, including 24% growth both for house and for units in 2021.

Where to in 2022?

The answers to these questions, and a whole lot more, were revealed by award-winning buyers’ agent
and author Miriam Sandkuhler of Property Mavens and Hotspotting founder Terry Ryder in this free webinar.

When we cast our vote at the ballot box and elect Governments to represent our best interests and help our economy thrive, quite rightly we think they’ll put a lot of thought into the decisions they make.

We’re entitled to believe that any changes in will be well-thought-out and all consequences considered in the best interests of most citizens.

Well, that might be what we all expect but I’m sorry to say it’s often not the reality when it comes to regulations around the housing industry.

In most instances, our political leaders don’t think much beyond the press conference.

It is becoming increasingly difficult to find affordable areas that have good prospects and where the prices haven’t gone crazy already.

But we’ve identified some prosperous regional centres, with affordable properties, good lifestyles and prospects for future price growth.

The National Top 5 Cheapies with Prospects, Regional edition, identifies five locations within regional areas that perfectly suit the exodus to affordable lifestyle trend for owner occupiers and investors.

The latest quarterly edition of Commsec’s State of the States report has ranked South Australia the No.2 growth economy in the nation.

There’s lots of dynamic things happening in the Adelaide economy, including its growing reputation as the Silicon Valley of Australia and it’s status as the No.1 centre for alternative energy development.

So now the city is growing at a rate faster than the historical norms – and its property market is responding positively.

Adelaide is an attractive city which offers lifestyle, attractive affordability compared to the bigger cities, extremely low vacancy rates and overall great prospects for price growth.

Adelaide prices grew 25% in 2021 and we can expect more big performance in 2022. Its market up-cycle is really just getting started.

So get yourself a copy of our new 2022 edition of Top 5 Adelaide Hotspots and find out which locations we rate the highest in the city we consider to offer the best value-for-money in capital city Australia.

https://www.hotspotting.com.au/product/top-5-adelaide/

Stand by for a year of negative forecasts about real estate from the usual suspects, who will be yet again proven wrong.

It’s already under way. We’ve been hearing that property prices will fall because interest rates will rise. There have even been articles suggesting that prices will fall even if interest rates don’t rise, because media speculation about interest rate rises will have the same negative effect.

Let me tell you this with certainty: none of it will happen.

Property prices have grown so substantially in the past two years that you’d be forgiven for thinking your chances of securing something affordably priced within a capital city is now close to zero.

That may be the case in the Sydney and Melbourne markets, but our new 2022 edition of the National Top 5 Cheapies with Prospects city report reveals five capital city precincts where you can buy affordably with good prospects for future capital growth.

I believe property prices will continue to grow strongly in 2022, although you will not see similar predictions from any of Australia’s leading bank economists. They’re mostly forecasting very small price growth this year and I’m quite sure they will be proven wrong, yet again.

When it comes to predicting property price growth, economists have a quite woeful track record – they invariably got it wrong - and usually spectacularly wrong.

The biggest mistake that we see most economists make, is that they talk about Australia as a single market.

They also tend to err on the side of negativity, because they fail to truly understand real estate markets and under-estimate the ability of real estate to deal with economic upheaval.

As a result, economists usually, frequently, get it wrong with their price forecasts.

You could be forgiven for thinking the Sydney property market has run out of steam.

Media recently has highlighted reports that the monthly changes in median house prices eased a little in late 2021.

But it would be a mistake to think that Sydney’s boom is over.

I think that in 2022 some precincts of the Sydney market will continue to show exceptional price growth.

We have just published our new 2022 edition of Top 5 Sydney Hotspots and it highlights five precincts within the Greater Sydney Area that I believe will achieve above average price growth this year.

Opportunities remain in the Sydney market to buy well with good prospects for long-term capital growth.

To find out where to focus your attention, get the new 2022 edition of the Top 5 Sydney Hotspots report.

The price performance across Regional NSW is extraordinary.

Our analysis of 296 suburbs and towns across the state shows that all but two have delivered growth in their median house prices in the past 12 months.

Nine out of ten locations have recorded double-digit annual growth, including 55% of locations which have risen by 20% or more.

Two-thirds of the Regional NSW locations have jumped by more than 5% in the past quarter.

Find out more in our new Top 5 NSW Regional Hotspots Report.

Virtually every suburb in the Greater Sydney Area has delivered growth in their median house prices in the past year and in the most recent quarter.

Only three suburbs – Darlinghurst, Artarmon and Hurlstone Park – failed to record annual growth in house prices.

The vast majority of Sydney suburbs recorded double-digit growth in their median house prices, including 44% which rose by 20% or more in the past year.

All but three suburbs recorded median house price uplift in the most recent quarter, with six out of 10 suburbs achieving quarterly growth above 5%.

FInd out more in our new Top 5 Sydney Hotspots report

It’s useful, I think, to look back and see how the market performed in the past 12 months and what that means for 2022.

While solid past performance isn’t always an indication of how well things will perform in the future, it does gives those who already own an investment property a bit of an indication of how well their assets are performing.

2022 promises to be the most fascinating year in real estate in a long, long time.

2021 was a relatively straightforward time in terms of what was happening in residential property – in simple terms, prices were rising pretty much everywhere.

Indeed, most locations across Australia recorded double-digit growth in house prices throughout the year. Many locations rose by more than 20%.

2022 is shaping as a more segmented market – or, put another way, 2022 is expected to be a more normal market.

A normal market in Australia is one where some locations are rising strongly, some are rising moderately, some are marking time or stagnating, and a few have falling prices.

This is because property markets are essentially local affairs. Property markets outcomes are dictated by local economic conditions, and these tend to vary from one place to another.

So in 2022 we will see different market scenarios evolving in different locations across the nation.

While there has been a nationwide property boom over the past 18 months, some locations have had strong property markets for much longer than that.

There are places in Australia which have had major growth in their property prices for the past three, four or five years.

In 2022, some of these locations may start to fade.

But many other places are just getting starting on their growth cycles and will continue to deliver big price increases in 2022 and beyond.

So how do you determine which is which – and how do you decide which are the best places to buy.

Hotspotting has two new reports which can answer those questions for you.

One is the new 2022 edition of our National Top 10 Best Buys report. This nominates the 10 locations across Australia that stand out for their growth prospects, taking a longer-term view.

The other is the new Summer edition of The Price Predictor Index. This report classifies every significant suburb and town in the nation in term of its current growth patterns, providing a unique guide to prospects for price movements in the shorter-term.

So, the ideal way to be make informed decisions about where to buy and where not to buy is to get a copy of both these reports: the National Top 10 Best Buys report and the Summer edition of The Price Predictor Index.

The best way to chart what’s happening with individual property markets around Australia is to look at the sales activity.

Sales volumes data is a forward indicator of what might happen with prices. If sales activity is rising, then prices will usually follow this trend, but with a time lag.

If sales activity is falling, prices are likely to stop rising or possibly decline.

Media focuses its attention on giving historical data on prices – what’s happened with price movements in the past three months or the past year.

That can be of interest, but it doesn’t necessarily inform the future.

Sales volumes data does inform the future. It tells us where prices are likely to rise, and where prices may stop rising, or possibly fall.

So, every three months, we get the figures on sales volumes for every significant town and suburb across Australia and analyse the trends.

We marry that with information about vacancy rates and prices to produce one of our most popular reports, The Price Predictor Index.

We have just published our new Summer 2021-22 edition and this shows that markets are continuing to pump strongly in many parts of Australia.

But activity is not rising everywhere. Some locations are showing evidence of having passed their peaks, after several years of good growth.

So this report provides a fantastic national overview of all the markets across the country and tells you which ones are rising, which ones are plateau-ing, which ones are falling and sometimes the ones we think are danger markets to be avoided.

So get yourself a copy of the Summer edition of The Price Predictor Index.

It’s a great way to be informed about individual markets right across Australia – and their prospects for 2022.

https://www.hotspotting.com.au/product/price-predictor-index/

With markets rising – fast – in most markets across Australia, it feels like you could buy anywhere and achieve capital growth.

And that may be true – in the short term.

But sensible investors will be thinking beyond the current frenzy in markets nationwide.

They will be taking a long-term view.

And that means buying in locations that have identifiable drivers of price growth beyond the current nationwide property boom – keeping in mind that some markets, particularly those which started rising BEFORE the nationwide boom, appear to have passed their peaks.

Ultimately, I believe some investors will be disappointed in the long-term performance of their investments, because they haven’t considered their choice of location with sufficient care.

We have just published our latest edition of our most popular report, the National Top 10 Best Buys.

This is the new edition for 2022, focusing on locations I expect to out-perform in the New Year.

In making my choices for the 10 special locations included in this report, I have thought about the factors that will drive capital growth in the long term.

I have sought to target places that are relatively early in the growth cycle.

And I have opted for places which offer a degree of affordability, because I believe that will increasingly be a factor in 2022.

That is why some of the nation’s most high-profile markets are NOT included.

Because they have already had, in some cases, three or four years of strong price growth.

I want the highlight the places that have the potential to do that, but are just getting started on a longer-term growth path.

So grab a copy of our new National Top 10 Best Buys report and find out where to buy in 2022 for growth is sustainable, beyond the current frenzy.

https://www.hotspotting.com.au/product/national-top-10-best-buys/

In media discussions about the many strong property markets across Australia, one city that often tends to be overlooked is Perth.

Perth, in fact, is one of the most buoyant markets in capital city Australia, particularly in terms of the strength of sales activity.

Our latest quarterly survey of sales volumes shows that Perth continues to maintain a very high level of performance, with 65% of suburbs classified as rising markets – one of the strongest results in the nation.

The 116 suburbs classified as rising markets is the second highest number for Perth in the six years we have been conducting our quarterly surveys of sales activity.

To put this into perspective, in the surveys from 2015 through to the end of 2020, the average number of rising suburbs in Perth was 29.

The four surveys conducted in 2021 have revealed 118, 103, 115 and 116 suburbs with rising sales momentum.

This means the Perth market is at its strongest since the end of the resources investment boom in 2013.

This strength is reflected in both the number of locations with rising sales activity and in price growth outcomes.

Prices are growing right across the Greater Perth area, although not yet at the same rates as elsewhere in Australia.

Of the 177 suburbs included in our price analysis, all but two had annual growth in their median house prices – with 155 of them rising more than 5%.

And there is potential for price growth to accelerate, given the high level of market activity that is currently occurring.

Against this backdrop, we have just published the new 2022 edition of our Top 5 Perth Hotspots report.

It’s a report that warrants some attention from investors, because it outlines the locations we expect to perform best in a year that promises to be one of the best ever for the Perth property market.

https://www.hotspotting.com.au/product/top-5-perth/

The year just ending has been one of the most remarkable ever in Australian real estate.
It has produced outcomes which defied the doomsayers, with price growth that exceeded everyone's expectations.

And now our thoughts turn to 2022: what can we expect of the year ahead?
Will property prices continue to rise? And, if so, will the growth levels match those of 2021?
Will interest rates rise and does it matter anyway?
Will the re-opening of international borders and an influx of overseas migrants create a second wave of buyer demand?

At this special webinar event on 8 December, Hotspotting founder Terry Ryder facilitated a discussion with our panel of property experts to find answers to these and other questions about prospects for 2022.
Our panel includes investment advisors, buyers agents and mortgage brokers and each brings a perspective informed by years of experience at the coalface of housing markets across Australia.

Anyone who tunes into mainstream media in this country will be aware that there is endless speculation about what’s going to happen with interest rates.

This is happening for three reasons.

One, journalists and commentators apparently believe we’re all breathlessly interested in what might happen with interest rates some time in the future. I think they’re wrong.

Two, journalists and commentators generally lack imagination and are collectively incapable of coming up with original and useful story lines.

And three, they all apparently think that Reserve Bank governor Philip Lowe is a shameless and habitual liar.

The Reserve Bank governor has declared publicly, repeatedly, almost weekly, that the RBA has no intention of lifting the official interest rate any time soon.

Philip Lowe has stated many times that he expects the next interest rate to be in 2024.

So, no interest rate next year and no interest rate rise in 2023.

But media keeps telling us that interest rates will rise in 2022. That’s their first mistake.

Their second mistake is that they apparently believe that an interest rate rise will bring the property market crashing.

A rate rise will cause massive mortgage stress, apparently, and prices will fall.

I’m happy to go on the public record as saying that they’re wrong and that none of this is going to happen.

And here’s why.

Firstly, history shows us that an interest rate rise does not halt a strong property boom.

Indeed, two or three interest rate rises don’t make a dent in a booming housing market.

In the recent past, it has taken 5, 6 or 7 interest rate rises to bring a raging property market under control.

It’s worth noting that the last time we had genuine nationwide property booms in Australia, in the late 1980s and in the early years of this century, they occurred during times of very high and rising interest rates.

Secondly, the notion that interest rate rise will collapse the property market is based on the premise that the current boom has been caused, wholly and solely, by record low interest rates.

Economists are telling us this every day, demonstrating yet again how little they understand about the housing market.

My list of reasons for the national property boom has 16 dot points, with the level of interest rates just one of them.

Low interest rates didn’t cause the boom - and rising interest rates, if and when they occur, won’t stop it.

Thirdly, media speculation about mortgage stress caused by future rises in interest rates overlooks the buffers that are in the system.

Most households are well ahead on their mortgage payments – years ahead, in many cases.

And borrowers are not assesses on current interest rates, they’re assessed on current rates plus 3%.

So anyone taking out a home loan with a 2% interest rate, will be assessed by the bank on their ability to repay the loan if the interest rate is 5%.

So rates could double and most borrowers would still be comfortable.

In summary, if you’re thinking of buying real estate and you’re worried about all the media speculation about interest rates, forget about it.

Ignore it. Tune out all this media white noise and just get on with it.

Media has gone overboard on the forecast by the Commonwealth Bank that property prices across Australia will fall 10% in 2024.

As consumers, we can rest assured that it won’t happen - because the people making these forecasts have a track record of getting it horribly wrong in their property market predictions.

There are two major things wrong with the media treatment of forecasts like this:-

One is the speed with which media turns a forecast into a fact. It’s not a case of someone forecasting that prices may fall 10% in the future, but it’s presented as: prices WILL fall 10%.

The second is that journalists never check on the forecasting record of the people they’re publicising. If they did, many high-profile forecasters would never appear in media – because they constantly get it wrong.

The Commonwealth Bank’s latest prediction on prices comes from the CBA’s head of economics, Gareth Aird.

Media assumes this is credible because it comes from one of the Big 4 banks and CBA is our biggest mortgage lender. They must know what they’re talking about, right?

Well, actually, NO.

Based on his track record, Gareth Aird is one of the nation’s worst forecasters.

Let’s look at what he predicted in March 2020 as the pandemic first took hold.

He forecast that residential property prices would drop 10% over six months and 20% in the next year, led by steep falls in Sydney and Melbourne.”

BUT in the next 12 months house prices overall rose 7.5%, with Sydney up 8%, Adelaide 9%, Hobart 13%, Canberra 14%, Darwin 16% and Regional Australia by an average of 13%.

Now, let’s look at his forecast at the start of 2021.

In February 2021, Gareth Aird on behalf of the Commonwealth Bank, was forced to admit they’d got it seriously wrong a year earlier and were now predicting price rises.

But their forecast was: House prices will rise 9% in 2021 and unit prices will rise only 5%.

What’s actually happened? House prices have risen 21% and unit prices 13% in the first 10 months of the year alone.

Once again, they’ve underestimated housing markets across Australia. And they continue to discuss Australia as a single unified market, without allowing for many regional differences.

Let’s face it, Gareth Aird would struggle to accurately forecast what happened yesterday.

And why does this failed forecaster think prices will fall in 2024? Because he expects interest rates to rise and this will generate a big drop in prices.

This, I have to say, is kindergarten analysis. Simplistic, misguided and plain wrong.

Regional Victoria continues to be an outstanding performer on price growth, although the sales activity data suggests that some locations have passed their peak.

Regional Victoria has been a strong growth market for past two years – and some of the key locations, like Geelong and Ballarat, have been growth markets for 3-4 years – so it’s not surprising that the markets which have strong for longest are now fading a little.

On the other hand, many locations throughout Regional Victoria stepped on to the growth path only in the past year and still have plenty of uplift still to come.

Meanwhile, Regional Victoria continues to be one of Australia’s outstanding performers on price growth.

Of the 142 locations included in our recent price analysis, only two have failed to record annual growth in their median house prices. Only three have failed to deliver increases in the most recent quarter.

Of the 140 suburbs and towns which had median house price rises in the past year, 137 have grown by 5% or more – and 48 have grown by 20% or more (compared to 25 suburbs in Melbourne with that level of house price growth).

So, in that regard, Regional Victoria is outperforming Melbourne.

Against this background, we have published our new edition of our popular report, Top 5 Regional Victoria Hotspots.

This report is essential reading for anyone planning their investment decisions for the coming year as it provides research-based evidence of the markets we expect to do well in 2022 and beyond.

Get a copy of our new Top 5 Victoria Hotspots report.

Melbourne has defied the negative impacts of multiple long lockdowns - including the prolonged one that ended in October 2021 - to deliver consistently solid growth in prices right across the metropolitan area.

While Melbourne’s overall price performance is less spectacular than other jurisdictions, but it is extraordinarily positive in the circumstances.

Melbourne has been declared the world’s most locked-down city. Melbourne has endured 262 days, or nearly nine months, of restrictions during six separate lockdowns since March 2020, representing the longest cumulative lockdown for any city in the world.

Despite that, 95% of Melbourne suburbs have recorded growth in their median house prices in the past year and 97% have had growth in the latest quarter. Only nine suburbs across the Melbourne metropolitan area have experienced a decline in median house prices in the latest quarter, which coincided with the city’s latest long lockdown.

Of the 283 Melbourne suburbs in our recent price analysis, 270 have recorded annual price increases, including 235 which have grown by 5% or more.

Melbourne has also maintained a surprisingly high number of suburbs with upward momentum in their sales activity.

In our latest quarterly survey, we identified 153 suburbs with rising sales activity, despite all the restrictions which afflicted the market – including a lockdown that extended from early August through to late October.

This is the third highest total of rising suburbs in the six years we have conducting these quarterly surveys.

Against that backdrop we have published our new edition of the Top 5 Melbourne Hotspots report.

Get a copy today to find out which parts of the Melbourne market are tipped to thrive in 2022, as the city embraces a new set of more favourable circumstances, which are likely to include a return of international students and an influx of overseas migrants.

Get a copy of the Top 5 Melbourne Hotspots

The Australian Financial Review, which allegedly is one our most serious and respectable newspapers, recently published a headline and article which declared that Australia is on the cusp of a rental crisis.

It beggars belief that this supposedly credible publication has only just realised that there’s a serious shortage of rental properties in Australia.

Australia has had a chronic shortage of homes available for rental for several years and it’s getting worse year by year because our state and federal politicians appear to be oblivious to the problem.

Right now, locations with vacancy rates below 1% are the norm across the nation.

This means there’s a dire shortage of rental properties almost everywhere.

And, as a consequence, rents are rising strongly in cities and regional centres all over the country.

In many locations, hopeful tenants can’t find a rental property at any price. But where there is something available, there’s lots of competition from other prospective tenants – and it’s common for people to offer more than the asking rent to beat the competition.

So rents are rising, almost as fast as sale prices.

But this is not a new situation. This has evolved over the past five years, as a result of a series of major decisions by politicians and bureaucrats which have discouraged property investment in Australia.

Decisions by various state governments, decisions by the Federal Government, mandates from APRA and rhetoric at the last two Federal Elections by the Labor Party – have all worked to discourage property investors.

Rental vacancies are an outcome of investor activity. When investors buy real estate, homes become available for tenants to rent.

But, for the past few years, investors have been sitting on the sidelines.

So, steadily, little by little, vacancies have become smaller and smaller.

The only way to fix this problem is for governments to stop discouraging investors and do the opposite – provide incentives for investors to get into the market and lift the pool of homes available for rental.

The bottom line - is that this situation is not great for people who need to rent, it IS a great time to be a landlord in Australia.

New data on property prices from CoreLogic indicates that the average Australian home has increased in value by $127,000 in the past 12 months.

While that sounds spectacular, there are suburbs and towns in this country where median house prices have grown that much in the last three month alone.

Looking more broadly, if we look at median house prices in some of our cities a year ago and compare them with the current situation, we find that the median house price in Brisbane has increased by almost $200,000 in the past 12 months, and there’s been a similar rise in Hobart.

In Sydney, the median house price is now $360,000 higher than it was a year ago.

The latest price data, up to the end of November, reveals that Australian house prices show no sign of slowing down.

There was a further increase of 1.4% nationally in November, led by a 2.2% monthly rise in the Combined Regions.

Growth in median house prices in November was led by 3.2% rise in Brisbane, followed by Adelaide (2.6%) and Regional NSW (2.5%). The regional markets in Queensland, Tasmania and South Australia all rose by 2.2% or 2.3%.

In the latest quarter, house prices rose 4.7% nationally and units 3.2%, while in annual terms house prices are up 24.6% and unit prices 14.2%.

The data shows no sign of the slowdown in price growth reported in some sections of the media.

Annual growth in house prices is being led by Regional Tasmania, Regional NSW and Sydney, which have all risen about 30% in the past 12 months.

Other jurisdictions to record big increases include Brisbane, Canberra, Hobart, Adelaide, Regional Queensland and Regional Victoria.

They’ve all increased by between 24% and 28%.

So, while media outlets seem to be competing to be the first to declare an end to the property boom and desperately searching for evidence to support the claim, these latest figures show that price escalations at continuing at exceptional pace in most markets across Australia.

The best way to learn how to build a property portfolio is to speak to people who have done it with resounding success.

On Wednesday evening 24 November Hotspotting provided that opportunity, with a webinar featuring successful property investors.

Hotspotting founder Terry Ryder hosted a discussion with real estate consumers who have created strong portfolios of residential properties which provide positive cashflow and have delivered spectacular capital growth.

They outlined their investment philosophies and the tools they have used to steadily build property portfolios worth many millions of dollars.

Many Australians are looking for guidelines for success with property investment – a simple methodology to guide their decisions on what to buy and where to buy.
One simple formula that I often recommend for success in property investment is this:
• follow the infrastructure trail.
Or, put another way, buy real estate that lies in the path of progress.
Few things impact on real estate markets as dramatically as major new infrastructure spending.
Construction of a new motorway, or rail line, or hospital, or university, generates economic activity and creates jobs, from which emerges demand for real estate.
These kinds of amenities also greatly improve the appeal of the locations that benefit, in the eyes of buyers.
So real estate is boosted in multiple ways when major infrastructure projects happen.
This factor is more relevant to property consumers than ever before, because Australia is entering a period of intense concentration on the creation of major new infrastructure.
Federal and state political leaders intend to generate an infrastructure-led economic recovery in Australia.
This will continue to turbocharge the residential property boom which has been raging across the nation throughout 2021 and will continue in many locations in 2022.
Government plans to fast-track shovel-ready projects will enhance the established trend of rising markets in many parts of Australia.
This makes our National Top 10 report based on the locations poised to benefit the most from big spending on new infrastructure particularly timely.
Buying real estate in these locations provides an additional level of confidence that the property you buy will grow in value over time.
So get yourself a copy of our “Infrastructure-led Economic Recovery: National Top 10” report today.

https://www.hotspotting.com.au/product/infrastructure-national-top-10/

Recently I researched and wrote a report for the nation’s biggest comparison website Canstar, which was called the Rising Stars report.

The report used a series of metrics to assess all the capital cities and the major regional markets across Australia - and then rank them on their prospects for price growth.

The rankings of the 14 major market jurisdictions around the country found that top 2 markets in Australia are Regional NSW and Regional Queensland.

This confirms our view that the most powerful force impacting Australian real estate at the moment is the Exodus to Affordable Lifestyle, which has resulted in such strong price growth in regional markets.

I believe this will continue to be the case, given the very powerful forces which are driving demand for real estate in regional areas.

Queensland is proving to be the No.1 destination of choice for Australians relocating from the big cities and also for investors seeking affordable properties with good yields and prospects for capital growth.

So it’s timely that we have published our new edition of the Top 5 Regional Queensland Hotspots report.

This identifies the locations across the regional areas of the state which offer the key features that investors are seeking –

A reasonable level of affordability
Good rental returns
Good prospects for growth

https://www.hotspotting.com.au/product/qld-regional/

Media attention following confirmation of the 2032 Olympics has put increased focus on the potential of the Brisbane property market.

There’s an expectation that the lead-up to this global event will direct a positive spotlight on the Queensland capital and generate a property boom.

The reality is that Brisbane was already a rising market before the IOC made its announcement in July.

People are migrating to Brisbane from other parts of the nation, attracted by its lifestyle, its affordability and its track record in keeping the pandemic at bay.
The infrastructure spend is elevated, creating big economic activity and jobs, which is bringing in new residents.
The latest survey from PIPA indicates Brisbane is the No.1 choice for Australian property investors planning their next move.
The fact that Brisbane property values are half those in Sydney makes its property attractive to big city buyers.
Its vacancy rate is much lower than Sydney’s or Melbourne’s and rents are rising. So it’s a very good time to be a landlord in Brisbane.

So Brisbane has big momentum in its property market.

Sales activity has exploded in the past 12 months and that is now leading to price growth.

The key issue for investors is: what to buy and where to buy it.

It’s a mistake to believe that, in this buoyant market, you can buy anywhere and get good growth.

So the new edition of our Top 5 Brisbane Hotspots report is essential reading for anyone thinking of getting into the Brisbane market.

It outlines the particular locations we think are worthy of special attention, as Brisbane embarks on its 10-year property boom.

https://www.hotspotting.com.au/product/top-5-brisbane/

When we published our Exodus to Affordable Lifestyle: National Top 10 report a year ago, our No.3 and No.4 picks were the Mornington Peninsula in Victoria and the Central Coast in New South Wales.

Both have delivered extraordinary price growth in the 12 months since then.

The Central Coast has attracted enormous buyer demand because of its water-based environments at affordable prices close to Sydney – and most of its towns and suburbs have grown more than 20% in the past year.

The Mornington Peninsula has attracted lots of buyers from Melbourne and many of its suburbs have experienced exponential growth. Most of the Peninsula suburbs have risen more than 20% and two have increased by over 40%.

Now, all of that is of passing interest only. It tells you where you should have bought a year ago.

But our new edition of the Exodus to Affordable Lifestyle report suggests locations that are earlier in the cycle than the Central Coast or Mornington Peninsula and potentially have more upside for investors who buy now.

Our new report outlines 10 locations which have prospects for growth in 2022 and offer a lifestyle outside of the big cities at affordable prices. So get yourself a copy today. This is fast becoming our most popular hotspots report. https://www.hotspotting.com.au/produc...

Imagine buying an investment property for under $350,000 and having it grow by $100,000 in 12 months.

Or spending a little over $500,000 and watching the market add $150,000 to its value within a year.

This has been the outcome of investors who purchased our first Exodus to Affordable Lifestyle: National Top 10 report in October 2020 and bought typical properties in the recommended locations.

A year ago we termed this “the most potent force to impact housing markets nationwide in the 21st Century” and forecast it would generate a national property boom.

Our No.1 pick in that first Exodus report was the Victorian regional city of Bendigo, where most suburbs have achieved price growth above 20% in the past year. The median price for the central suburb of Bendigo has increased 30%, or $140,000, from $395,000 to $535,000 in that time. The suburb of Maiden Gully has zoomed from $515,000 to $665,000, a rise of 28% or $150,000.

Our No.2 pick in our inaugural Exodus to Affordable Lifestyle: National Top 10 report was the Sunshine Coast. In several of its suburbs, median house prices have increased by $250,000 or $300,000 in 12 months. Alexandra Headland is up 31% from $965,000 to $1,275,000, a rise of $310,000, while Sunrise Beach has jumped 30% or $300,000 from $995,000 to $1,295,000. Sunshine Beach has added “only” 16% in the past year, but this has added $290,000 to its median price.

The question for real estate consumers is: Will the growth continue?

The consensus among most analysts is that prices will keep on rising in 2022, although perhaps at lower rates of growth than in 2021 – in some locations, at least.

With this in mind, we have just published our new edition of the Exodus to Affordable Lifestyle: National Top 10 report.

This edition introduces a number of new locations to the report, in recognition of the reality that some places have already had massive growth in their prices. To find out where we see further growth in affordable lifestyle locations, get this report – which has quickly become the most sought-after of the forward-looking reports published by Hotspotting.

Get a copy today

Brisbane and South East Queensland comprise the hottest market in the nation, at a time when heated real estate markets abound across Australia.

One of the key features driving the frenetic markets in Brisbane, the Gold Coast and the Sunshine Coast is low vacancies and strongly rising rentals.

Vacancy rates in Brisbane have dropped dramatically in the past two years and the city now has a vacancy rate only marginally above 1%. Many postcodes across the metropolitan area are below this benchmark.

Inevitably, rents are rising – with SQM Research data indicating that Brisbane house rents are 13% higher than a year ago.

At the same time, dwelling values are rising rapidly as the city is targeted by first-home buyers, investors and migrants from interstate.

After recording only moderate growth in the past 10 years, Brisbane is moving into a dramatically different decade – and is facing a prolonged property boom, driven by the Exodus to Affordable Lifestyle, affordability relative to the biggest cities and an elevated infrastructure spend.

But the ultimate game-changer is the 2032 Olympics, which will focus an international spotlight on Brisbane and South East Queensland.

It’s shaping as a great time to be a landlord in the Queensland capital.

But how can investors take advantage of the looming opportunities.

To discuss this topic, Hotspotting founder Terry Ryder hosted a webinar on Wednesday 27 October, featuring seasoned property manager Mark Shorrock of Bluestone Property Management & Sales.

All of a sudden, everyone wants to own a piece of Brisbane.

The recent survey conducted by PIPA shows that Brisbane dominates the locations that investors across Australia want to target.

There are four key reasons why Brisbane is blipping so loudly on the radar screens of investors:-

The market is now rising strongly after a decade of only moderate growth
Brisbane real estate is half the price of Sydney
Queensland is seen as a safe haven
The 2032 Olympics is a game changer

The feeling, strongly, is that Brisbane’s time to shine has arrived.

Population data hugely favours Brisbane and South East Queensland, it is a major recipient of the Exodus to Affordable Lifestyle trend, it offers affordability as well as lifestyle, a major infrastructure spend is rejuvenating the economy and the city scores big points for its control of the coronavirus.

Its success in keeping Covid-19 at bay has meant that Brisbane and Queensland has been hosting the four-nation Rugby Championship matches and the major finals of the NRL. That, and the favourable climate, only adds to the attention Brisbane is receiving.

So what does all this mean for real estate? And which locations should real estate consumers be targeting?

To answer these and other questions, Hotspotting founder Terry Ryder presented a special webinar event on Wednesday 13 October.

He discussed why Brisbane is fast becoming THE place where Australians want to own real estate.

Adelaide is the big improver among the city markets in 2021 and continues to be the nation’s most under-rated capital city.

I conduct quarterly surveys of sales activity across Australia and in the winter survey I found a record number of rising markets. But the Spring survey completed recently showed that Adelaide had topped that record by a big margin.

Two-thirds of suburbs across the Adelaide metropolitan area now have rising sales activity. The number of rising markets identified in our five most recent quarterly surveys have been 52 62 93 104 125.

That pattern shows the rise and rise of the Adelaide market and that is also reflected in the price data.

Adelaide’s median house price has increased 21% in the past 12 months – that’s higher than Melbourne, Perth and Darwin, and on a par with Brisbane.

The appeal of Adelaide includes its relative affordability. Its median house price of $575,000 compares with $960,000 in Melbourne, $1,310,000 in Sydney, $955,000 in Canberra and $710,000 in Brisbane.

It also has higher rental yields than all the other capital cities except Darwin, helped by ultra low vacancy rates well under 1%

All this is underpinned by an improving local economy, with South Australia rising up the rankings in the quarterly State of the States report published by CommSec.

Against this background, we have just published our new edition of Top 5 Adelaide Hotspots.

It reveals the markets within the Adelaide metropolitan area that I expect to excel for the rest of 2021 and well into 2022.

Prospects for ongoing growth in the SA capital are strong, driven by its affordability, value for money, low vacancies and good rental yields.

So make sure you get a copy of the Top 5 Adelaide Hotspots report and find about some of the best value real estate anywhere in Australia.

Australians in lockdown or operating under travel restrictions are saving lots of money.

Research data shows we’ve collectively saved $60 billion from not being able to travel overseas in the past 12 months.

Other research suggests Australians are putting that money into investments or renovations.

But there are many possibilities.

In our special webinar event on Wednesday 29 September, Hotspotting founder Terry Ryder was joined by award-winning mortgage broker Louise Lucas to discuss how people can make their savings work best for them in real estate.

Lucas, of The Property Education Company, explored a number of key options, including:-

• Is it better to use redraw or an offset account to reduce the interest paid on investment loans?
• Is it worth refinancing existing loans?
• Should you use cash or release equity to buy a new investment property?
• How can you assess if you can afford new property investments

Ryder also discussed where best to buy an investment property in the current climate of rising prices, identifying markets with growth prospects which are not yet frenetic.

A recommended reference from Louise is the ATO Rental Mortgage Interest Expenses Guide

The best way to chart what’s happening with individual property markets around Australia is to look at the sales activity.

Sales volumes data is a forward indicator of what might happen with prices.

If sales activity is rising, then prices will usually follow this trend, but with a time lag.

Media focuses its attention on giving historical data on prices – what’s happened with price movements in the past three months or the past year.

That can be of interest, but it doesn’t necessarily inform the future.

Sales volumes data does inform the future. It tells us where prices are likely to rise, and where prices may stop rising, or possibly fall.

So, every three months, we get the figures on sales volumes for every significant town and suburb across Australia and analyse the trends.

We marry that with information about vacancy rates and prices to produce one of our most popular reports, The Price Predictor Index.

We have just published our new Spring 2021 edition and this shows that markets are pumping in many parts of Australia.

But activity is not rising everywhere. Some locations are showing evidence of having passed their peaks, after several years of good growth.

So this report provides a fantastic national overview of all the markets across the country and tells you which ones are rising, which ones are plateau-ing, which ones are falling and sometimes the ones we think are danger markets to be avoided.

So get yourself a copy of the Spring edition of The Price Predictor Index.

It’s a great way to be informed about individual markets right across Australia.

Every Australian with a pulse knows real estate markets are rising across the nation.

And, increasingly, as prices rise and rise, that creates issues of affordability for more and more buyers of all sorts.

The key question for many investors and home buyers is: Where can you buy that still offers good value for money and has good prospects for future growth?

At Hotspotting we seek to answer those questions with the reports we call the Cheapies with Prospects.

Every four months we compile our Cheapies Bundle which comprises our …

National Top 5 Cheapies with Prospects: City Edition, and
National Top 5 Cheapies with Prospects: Regional Edition.

It might surprise people to discover that you can still buy houses in locations with good prospects for growth in capital cities in the $300,000s – and, in some cases, in the $200,000s.

Clearly, I’m not speaking about Melbourne or Sydney, but this is certainly attainable in growth cities like Brisbane, Adelaide and Perth.

And, similarly, Australia outside the capital cities abounds with regional centres with great future prospects, where you can buy solid properties in the $200,000s and $300,000s.

So this week we have published our new Cheapies Bundle.

This comprises the two reports which together offer 10 locations across Australia that offer both affordability and the basic credentials for capital growth.

So get yourself this Bundle of two reports which provide valuable clues on how to buy affordably and sensibly in a crazy market.

https://www.hotspotting.com.au/product/cheapies-bundle/

Learn Six Crazy Facts About Depreciation
- Plus the Top 5 areas of Australia attracting investor buyers

If you have trouble getting your head around the concept of depreciation of houses and apartments, you are not alone.

It’s puzzling for many investors that the value of their building is depreciating in value, at a time when property values are rising so strongly right across Australia.

Property values are up more than 20% this year, as an average across the nation, according to the latest data from CoreLogic.

But, in simple terms, it’s the land content that appreciates in value – while the structure and the fixtures and fittings depreciate in value over time.

This reality is important for property investors, because they can reduce the amount of tax they pay by many thousands of dollars per year by claiming depreciation.

A deprecation report by experts Washington Brown can dramatically improve the bottom line for property owners.

In this free webinar on Thursday 16 September, Washington Brown’s Tyron Hyde and Peter Foldes joined Hotspotting founder Terry Ryder to discuss the issues.

Foldes presented state-by-state statistics on where investors are buying, including the Top 5 LGAs for attracting investors, while Hyde discussed his new report “Six Crazy Facts About Depreciation”.

The regional areas of NSW abound with growth markets, as big city residents continue to target affordable lifestyle areas. Most locations are delivering big price rises.

There are 181 suburbs and towns throughout Regional NSW with rising sales momentum, which equates to 61% of locations.

The major population centres – Newcastle/Lake Macquarie, the Central Coast, and Wollongong/Shoalhaven – are all pumping strongly, as are other key regional centres like Tamworth, Wagga Wagga, Orange and Dubbo.

Coastal municipalities in the south, like Eurobodalla and Bega Valley, are being targeted by lifestyle buyers.

And there are smaller regional centres with upwardly-mobile markets, including Armidale, Bathurst, Broken Hill, Cowra, Glen Innes, Goulburn, Griffith, Gunnedah, Inverell, Kempsey, Leeton, Moree and Parkes.

Markets throughout Regional NSW are delivering exceptional price growth, from major regional centres like Newcastle and Wollongong to small rural towns like Glen Innes and Cootamundra.

Virtually every town or suburb through Regional NSW (97%) has recorded growth in their median house prices in the past 12 months and in the most recent quarter. Two-thirds have had annual growth above 10%. Only seven of the locations analysed in this report have failed to record growth in the past year.

There is spectacular growth right across NSW, but locations close to Sydney stand out. The Central Coast, the Blue Mountains, the Southern Highlands, Wollongong and the Shoalhaven all have stand-out examples.

So, against this background, we have just published our new edition of the Top 5 Regional NSW Hotspots report.

It outlines five key regional centres in the state which offer affordability and lifestyle – and have great prospects for capital growth in the short-term but more importantly in the long-term as well.

So get yourself a copy of the report and find out our picks for the best places to target as investors in Regional NSW.

https://www.hotspotting.com.au/product/top-5-nsw-regional/

Sydney is defying not only the pandemic but conventional wisdom.

It has suffered major lockdowns, it is losing population to internal migration and overseas migration has been shut down, yet its market is booming.

In the circumstances, according to economic theory, Sydney prices should not be rising and sales activity should be stalling.

Yet, according to CoreLogic data, Sydney’s median house price rose 1.9% in August, 7.1% in the latest quarter and 23% in the first eight months of the calendar year.

This is occurring on the back of extraordinarily high sales volumes.

Our latest quarterly survey analyses 339 suburbs across the Greater Sydney area and has found that 242 of them have rising sales activity.

This means 71% of suburbs have upwardly-mobile trajectories, one of the highest percentages in the nation.

In our Spring survey two years ago, we classified 66 Sydney suburbs as declining markets and 11 as danger markets.

In our latest survey, there are none ranked as declining and only three are danger markets (all apartment-dominated locations with high vacancies and declining prices).

Most of the municipalities across the Sydney metropolitan area have delivered notable results in our Spring survey.

In most Sydney LGAs, the vast majority of suburbs have rising sales activity.

Against this backdrop, we have published our new edition of the Top 5 Sydney Hotspots report.

It outlines five precincts which we think have good prospects for future capital growth.

So get yourself a copy of this report and find our the best places to buy in the capital city market which, despite everything, is leading the nation on price growth.

https://www.hotspotting.com.au/product/top-5-sydney/

When Covid-19 hit early in 2020, many predicted real estate values would be devastated. But the opposite has happened.
Media reports suggest real estate is rising despite the pandemic. But, in reality, prices are increasing strongly because of the pandemic.
Recent studies have confirmed that the economic and community forces unleashed by the coronavirus have been fundamental in driving strong demand for real estate and consequent price growth.
Multiple strong factors, many of them direct responses to the pandemic, are driving the national property boom.
This was the topic on Thursday 2 September when Hotspotting founder Terry Ryder hosted a webinar with AllianceCorp managing director Jason Paetow.

This not-to-be-missed live event examined …

• The prime drivers of this up-cycle
• How long the boom will last
• What’s happening with prices in key markets
• Why economists who originally forecast a collapse have revised their forecasts
• Why investors who hesitated wish they had acted
• The importance of having a long-term strategy
• The importance of ignoring media headlines and accessing quality advice

With markets rising – fast – right across Australia, it feels like you could buy anywhere and achieve capital growth.

And that may be true – in the short term.

But sensible investors will be thinking beyond the current frenzy in markets nationwide.

They will be taking a long-term view.

And that means buying in locations that have identifiable drivers of price growth beyond the current nationwide property boom.

Ultimately, I believe some investors will be disappointed in the long-term performance of their investments, because they haven’t considered their choice of location with sufficient care.

We have just published our new edition of our most popular report, the National Top 10 Best Buys.

In making my choices for the 10 special locations included in this report, I have thought about the factors that will drive capital growth in the long term.

And I have sought to target places that are early in the growth cycle.

That is why some of the nation’s most high-profile markets are NOT included.

Because they have already had, perhaps, three years of strong price growth.

I want the highlight the places that have the potential to do that, but are just getting started on a longer-term growth path.

So grab a copy of our new National Top 10 Best Buys report and find out where to buy for growth is sustainable, beyond the current frenzy.

https://www.hotspotting.com.au/product/national-top-10-best-buys/

Being constantly in and out of lockdown in some capital cities has created significant disruption to the property market and the economy. Yet we are in the middle of a real estate boom.

COVID-19 has been the catalyst, driver and accelerator of many trends in the real estate market.

In this live webinar multi-award-winning Buyers’ Agent Rich Harvey, CEO of Propertybuyer and respected researcher and commentator Terry Ryder Founder of Hotspotting discussed how the lockdowns have impacted the property market in the major capital cities, and these key questions:

How to buy and sell during a lockdown
Quick capital city round up
Why are we currently in a boom market?
How long can this boom last?
The impact of lockdowns on prices?The impact of lockdowns on listing volumes
What we’ve learnt from past lockdowns
Why buyers should have a sense of urgency
How to get yourself organised to take advantage
Case studies on where to buy in a rebounding Melbourne

This is a highly insightful webinar is ideal for home buyers and property investors to get the latest updates. Get real insights into real issues so you are confident with your property decisions.

Eighteen months of hard experience has shown us that lockdowns and other restrictions are no barrier to real estate growth in this country.

Melbourne has entered Lockdown 6.0 with its property industry not only resilient but defiant, with busy markets and rising prices right across the metropolitan area.

Meanwhile, Regional Victoria continues to be one of the nation’s strongest markets.

Our latest quarterly survey of sales activity and prices shows that most regional markets remain very strong.

Not only have prices risen in almost every location across the state, but 75% of them have recorded double-digit growth in their median house prices.

In my view, Regional Victoria was the birthplace of the dominant trend in Australian real estate, the Exodus to Affordable Lifestyle.

It started several years ago with Melbourne residents buying in the regions close to the state capital and has since been turbocharged by the pandemic and the multiple lockdowns which have afflicted the city.

So this week we have published our new Victoria Bundle: the Top 5 Melbourne Hotspots report and the Top 5 Regional Victoria Hotspots report.

Both provide compelling reading.

So get yourself a copy of the Victoria Bundle today and find out the best places to buy in Melbourne and Victoria, as markets continue to rise.

https://www.hotspotting.com.au/product/vic-bundle/

Interview on ABC Wide Bay about the property trend sweeping the nation.

One simple formula for success in property investment is to follow the infrastructure trail.

Or, put another way, buy real estate that lies in the path of progress.

Few things impact on real estate markets as dramatically as major new infrastructure spending.

Construction of a new motorway, or rail line, or hospital, or university, generates economic activity and creates jobs, from which emerges demand for real estate.

These kinds of amenities also greatly improve the appeal of the locations that benefit, in the eyes of buyers.

So real estate is boosted in multiple ways when major infrastructure projects happen.

This factor is more relevant to property consumers than ever before, because Australia is entering a period of intense concentration on the creation of major new infrastructure.

Federal and state political leaders intend to generate an infrastructure-led economic recovery in Australia.

This will turbocharge the residential property boom which is already under way across the nation.

Government plans to fast-track shovel-ready projects will enhance the established trend of rising markets in many parts of Australia.

This makes our National Top 10 report based on the locations poised to benefit the most from big spending on new infrastructure particularly timely.

Buying real estate in these locations provides an additional level of confidence that the property you buy will grow in value over time.

So get yourself a copy of our “Infrastructure-led Economic Recovery: National Top 10” report today.

https://www.hotspotting.com.au/product/infrastructure-national-top-10/

With markets rising almost everywhere in Australia, it feels like you can buy anywhere and get rapid capital growth.In the short-term, that may be true. But what about next year and the next five years?

What if you buy in haste and pay too much to beat the competition? And your chosen location lacks the growth drivers for long-term sustainable growth?

In this not-to-be missed webinar from 21 July, award-winning buyers’ agent Miriam Sandkuhler of Property Mavens joined Hotspotting founder Terry Ryder to discuss why investors and home-buyers need to be precise about location and price, even in a runaway property boom.

Sandkuhler, the best-selling author of “Property Prosperity”, will …

Provide case studies of bad location choices
Explain why some locations lack the drivers for sustainable growth
List the factors investors should target to find a good location
Advise ways to research local values to avoid paying too much
Explain why try-before-you-buy is a good strategy for city people relocating to the regions

So many of the major factors that are currently impacting real estate markets are strong for Queensland.

Two of the biggest influences are the Exodus to Affordable Lifestyle and the intention by federal and state governments to generate an infrastructure-led economic recovery across Australia.

The Exodus trend is the most dominant force impacting real estate in the 21st Century.

All the elements that might influence people to leave the big cities and migrate to another part of the nation – climate, covid, lifestyle and affordability – are strong for Brisbane and for Regional Queensland.

The official population data confirms it: Sydney and Melbourne are losing population to internal migration and the biggest beneficiary, by a wide margin, is Queensland.

The list of major new infrastructure projects targeted on Brisbane and Queensland is growing by the week.

This promises to be a big generator of economic activity and jobs – and from that comes demand for real estate.

And the ultimate game changer is the prospect of the 2032 Olympics in Brisbane.

This means that the next 10 years will feature major spending on infrastructure, big investment by private enterprise and a strong media focus on Brisbane and South East Queensland.

The real estate data confirms that Brisbane and Regional Queensland are at the forefront of the rising tide of real estate activity across the nation.

Sales activity is elevated and prices are responding.

Australians are heading north and so are Queensland property prices.

So our new Queensland Bundle is an information product designed for the times.

It includes the new edition of our Top 5 Brisbane Hotspots report and the new edition of our Top 5 Regional Queensland Hotspots report.

You can buy them separately or you can save by buying them together in the Queensland Bundle.

But whichever one you choose, do it today.

Whether you’re an investor or owner occupier, Buyer’s Agent and Qualified Property Investment Adviser Alex Dutt of Adviseable will show you useful professional insider tips to help you navigate a rabid market and secure the property you want.

In this free webinar, Terry Ryder and Alex Dutt discussed:-

Weighing up whether the timing is right to jump in and buy now
How to find value in the marketplace and the signals that it’s time to move on
The essential checklist to tick off before inspecting even your first property
How to get yourself to the front of the buyer queue without overpaying
How to successfully get a deal done in frenzied buying conditions
The common mistakes buyers make in a highly competitive market

There are many different forces feeding the nationwide property boom that’s currently sweeping across Australia.

I have a list of 15 different key factors that are helping to drive the boom.

But I have no doubt that the biggest of them is the one I call The Exodus to Affordable Lifestyle.

I believe this is the most powerful influence on residential property markets in the 21st Century so far.

This trend has been under way for several years, driven by advanced technology, giving more and more people the ability to work remotely,

and by the desire by more and more people to access a better lifestyle at an affordable price.

This trend has been turbo-charged by the pandemic and the enforced lockdowns and work-from-home periods that have resulted from it.

Now, more and more Australians are seeking to leave the big cities and move to smaller cities or to attractive regional areas, including Hill Change towns and Sea Change enclaves.

At a result of this strong trend, last year I wrote a new report, the Exodus to Affordable Lifestyle National Top 10.

And now I have published our latest edition of this report, injecting new locations which offer possibilities for the many Australians seeking to benefit from this compelling trend.

Get yourself a copy today.

https://www.hotspotting.com.au/product/exodus-national-top-10/

Stay ahead of the pack and the Tax-Man!

Join us on June 23rd and learn the answers to the Most Frequently Asked Questions asked by Washington Browns’ clients.

In this free webinar, Terry Ryder of Hotspotting will be discussing this important issue with Peter Foldes of Washington Brown Depreciation.

We’ll be covering which properties are eligible to claim depreciation deductions and taking a look at how much investors can claim per year on each:

New vs Second-hand
Residential vs Commercial vs SDA

The property market in Adelaide has taken another giant step forward.

Get the new Top 5 Adelaide Hotspots Report

I’ve just completed the research on sales activity and prices – and it shows that Adelaide continues to build on its recent good performance.

It’s gone from being a steady market to being a boom market – and that makes it a place investors need to consider, because Adelaide offers great value for money and much better rental yields than those available in the bigger capital cities.

In my Autumn 2021 survey three months ago, Adelaide had 93 suburbs with rising sales activity, easily a record in the six years I have been conducting our quarterly surveys.

My new Winter 2021 survey has revealed that there are now 104 suburbs with forward momentum. The past four quarterly surveys have recorded 52 62 93 and 104 suburbs as rising markets, in terms of sales activity, a pattern that shows how much the Adelaide market has advanced.

This is being reflected in price performance. The vast majority of Adelaide suburbs have rising prices and the latest data from CoreLogic shows that Adelaide house prices have increased 13% in the past 12 months – that’s better than Brisbane and Melbourne, and comparable with Sydney.

In the first five months of 2021, Adelaide prices have jumped 8% - and with the big increase in sales activity, that level of growth is expected to continue.

This week we have published our new edition of the Top 5 Adelaide Hotspots report.

I urge you to get a copy because Adelaide offers a high level of affordability, incredibly low vacancy rates, good rental yields – and great prospects for ongoing capital growth, underpinned by an economy that’s steadily rising.

So get yourself a copy of Top 5 Adelaide Hotspots today and find out the places I believe are the best ones to target in one of Australia’s most compelling growth markets.

Selecting the RIGHT property for YOU – It’s the trickiest thing to get right in real estate

Many people think there’s a right answer to basic property questions.

Where’s the best place to buy?
Is it better to buy new or established?
Are houses better than apartments?
Are capital cities better than regional areas?

The reality is: the right answer to those and other queries depends on the individual.

There’s not one right answer to real estate questions.

It’s about YOU the individual: your age, your current circumstances, your income, what you currently own, your personality, your life goals – and a whole lot more.

That’s why it’s so important for prospective investors to seek help from qualified professionals in finding the right property for the individual.

On Wednesday 9 June, Hotspotting founder Terry Ryder spoke with property investment expert Tim Graham of Reventon to discuss these issues.

As the residential property market rapidly recovers post-covid and desperation fills the real estate scene, it’s become harder for buyers to compete.

Too often buyers are led to believe they are on the back foot and have to agree to anything demanded by the selling agents to secure a property (e.g. your offer must be unconditional to be considered by the vendors). But this is not the case.

Leading mortgage broker and property investment expert Louise Lucas of The Property Education Company says: “Sorting out and sticking to your own race is the most important part of your property investing plan.”

On Wednesday 26 May, Lucas and Hotspotting founder Terry Ryder discussed smart ways to prepare to purchase in a hot market.

This webinar covered:-

How buyers can move quickly and efficiently when they have found a property they want to buy.
Why it is critical that investors sort out their funding options before they put time into searching for properties and competing in busy markets.
How to beat the competition with a compelling offer.
What you need to understand about loan pre-approvals – what they mean and don’t mean.

The Sydney market continues to perform at a high pitch, with the number of growth suburbs down only slightly on the record levels of the previous quarter.

In our Autumn 2021 survey of sales activity published three months ago, we identified 140 suburbs with rising sales activity, up from 93 the previous quarter.

In our current survey, the Winter 2021 survey, we have found 121 suburbs with rising activity - compared with just 24 a year ago.

This means Sydney overall has tapered marginally but still has the second highest number of growth markets in the six years we have been conducting our quarterly surveys.

This continues to translate into exceptionally strong price performance, with notable uplift over the past three months.

In terms of sales activity, the sectors which have shown notable improvement in our Winter survey are those which offer a degree of affordability – locations that are a tier or two above the bottom end but a little below the middle market areas.

They form two general growth precincts – west and south.

The price performance across Sydney in the past 12 months has been extraordinary.

Of the 223 suburbs in our price analysis, 217 (97%) have recorded growth in their median house prices, including 88 with increases above 10% and some above 20%.

Apartment markets have shown strong recovery signs also, with eight out of ten suburbs delivering annual increases in their median prices, most of them above 5%.

There are multiple growth suburbs in precincts right across the Sydney metropolitan area.

And this week we have published our new edition of the Top 5 Sydney Hotspots report.

In preparing this report, we have sifted through all that information and chosen five areas of Greater Sydney which we think have good prospects for growth, taking a medium to long-term view.

So, get yourself a copy and have a read – to make sense of the current market frenzy in Australia’s biggest city.

https://www.hotspotting.com.au/product/top-5-sydney/

In this free webinar, Terry Ryder of Hotspotting chats with Tim Graham COO of Reventon about the property market in South East Queensland.

As property prices rise rapidly across Australia, there is a growing chorus of voices concerned about the deterioration of affordability.

Some claim that more and more people are being priced out of the market.

As is so often the case, such claims can be exaggerated – designed more to drum up publicity than to inform the public.

Nevertheless, there’s no doubt that prices are escalating in many parts of the nation and that properties are selling quickly at often higher-than-expected prices.

It’s making it harder for investors to find affordable locations with good growth prospects.

That’s where Hotspotting comes in, with its Cheapies with Prospects reports.

These are the special Top 5 Hotspots reports that identify good places to buy, where the prices are cheap, but the growth prospects are strong.

We have two separate editions of the Cheapies with Prospects reports – the City edition and the Regional edition – but we offer them together, as a Bundle.

If you get the Cheapies Bundle, you’ll get access to 10 good locations to buy at affordable prices, and you’ll get the two reports together at a discount of 20% compared to the cost of buying the two reports separately.

So have a read of our Cheapies with Prospects reports to find out the best places to buy in the capital cities and in the regional areas at attainable prices – but, most importantly, with good prospects for capital growth in the future.

The Brisbane market is rising, boosted by its relative affordability, a big infrastructure spend and the prospect of hosting the 2032 Olympics.

Demand from home-buyers and investors, including large numbers of interstate buyers, has resulted in a massive uplift in sales activity – and prices are responding.

At the same time, rental vacancy rates are low in most parts of the city and there is great potential to lift rentals and yields.

On Wednesday 12 May, Hotspotting founder Terry Ryder hosted a free webinar featuring leading Brisbane real estate professional Mark Shorrock of Bluestone Property Management & Sales where they discussed ways for investors to benefit from the rising tide in the Brisbane market.

Shorrock presented case studies showing how investor owners can achieve rental increases of 10% or 15% in a market characterised by high demand and low supply.

When everywhere is having a price boom, how do you choose the ten best places to buy?

Right now, it feels like you could throw a dart at a map of Australia and buy wherever it lands – and you’ll get capital growth this year.

But investors should be thinking beyond the current boom and taking a longer-term view.

In times when buyers are busy, homes are selling quickly and prices are rising month by month, it’s critical that investors avoid being reckless.

It’s important to examine the credentials of locations and their potential to deliver sustainable long-term growth.

In considering our choices for this new edition of the National Top 10 Best Buys, we have looked at the more distant horizons.

We have opted for locations that …

Offer a reasonable level of affordability
Have low vacancies and rising rentals
Are underpinned by a strong and diverse economy
Have good existing amenities plus spending on new infrastructure
Fit the key trends that are likely to drive markets for the foreseeable future
Have not yet approached their market peaks.

Our new Top 10 list has locations spread across Australia and has a mix of capital city and regional locations.

They’re all places with great potential to deliver for investors.

So get yourself a copy of the new edition of our most popular product, the National Top 10 Best Buys report.

New research has shown that traditional rental properties fail to fulfil any of the major wish-list items of tenants. At the same time, investor owners often get disappointing rental returns from typical houses.

But a new housing concept now emerging in key market hotspots is addressing both problems.

Research by the Gallery Group, which gathered feedback from 1,300 tenants who were sharing homes with others, provided surprising results. Gallery Group CEO Adam Barclay says lone-person households are the fastest-growing segment in the market so they asked members of this cohort the kind of rental accommodation they wanted.

And the features these typical tenants wanted most were a private bathroom, a lockable pantry, fully-furnished premises and bedrooms that were air-conditioned and lockable – and without the owner living on the premises.

Most typical share houses or apartments fail to provide these desirable features.

This has given rise to a new concept dubbed Co-living – where purpose-designed new homes provide individual rooms with their own bathrooms in what looks like a conventional three-bedroom modern house.

Such a home in, say, Logan City in Brisbane’s south might rent for $400-450 per week as a conventional dwelling, but as a Co-living home each room can be rented separately for $275, totalling $825 per week.

On Wednesday 28 April, Hotspotting founder Terry Ryder hosted a special webinar on Co-Living, featuring buyers’ agent Scott Northcott of Property Hotspot and Adam Barclay of Gallery Group.

The long-awaited upsurge in the Perth market is upon us.

Perth has transformed from recovery to boom in the space of a few months, with a doubling in the number of suburbs with rising markets.

Our Summer 2020-21 survey of sales activity identified 59 rising suburbs across Perth, the highest in the six years we have been conducting our quarterly surveys.

But our latest (Autumn 2021) survey finds that the number has doubled to 118 suburbs, a remarkable change in just three months.

This uplift in buyer activity is being reinforced by other data, including very low vacancy rates, rising rents and increasing levels of price growth.

This avalanche of strong, positive statistics coming out of the Perth market coincides with the publication of our new edition of the Top 5 Perth Hotspots report.

It reveals that rising markets are spread right across the Perth metropolitan area and include a broad range of price points.

But the greatest momentum is at the affordable end of the market, with strength also evident in middle-market areas.

The LGA of Wanneroo in the far north has 14 rising suburbs, driven by first-home buyers and other owner-occupiers on a budget.

Many are suburbs with median prices in the $300,000s and $400,000s.

The City of Stirling, which regularly features in these reports, also has 14 rising suburbs. Stirling is a middle-ring LGA with a wide range of suburbs with different price points.

The significant upturn in sales activity recently is starting to translate into price performance.

In the past 12 months, 60% of Perth suburbs have recorded growth in their median house prices, but in the most recent quarter 78% have had price increases.

I expect this momentum in Perth prices to continue and it’s noteworthy that most forecasters expect Perth house prices to increase 10% or 15% in the next 12 months.

To find out the best places to buy in this strongly rising market, get yourself a copy our new Top 5 Perth Hotspots report and have a read today.

The growth being displayed by markets in Melbourne and Victoria is extraordinary, given the circumstances that have impacted these places over the past 12 months.
Melbourne, which has been affected by lockdowns more than any other part of Australia, was the major market which suffered the most in 2020.
But it has come roaring back to life, with a recovery which has stunned many observers.
According to CoreLogic figures, Melbourne house prices rose 2.6% in March and 5.6% in the March Quarter, while apartment prices increased 1.7% in March and 3% in the March Quarter.
This is happening on the back of significant uplift in sales activity, at a time when the number of listings of properties for sale remains low.
Inevitably, prices are rising.

Meanwhile, Regional Victoria continues to be one of the nation’s strongest markets.
Regional Victoria has been a national leader of the most dominating trend in Australian real estate, the one I call the Exodus to Affordable Lifestyle.
This has been driving regional markets in the state for the past three years or so – and it continues to do so.
Overall, house prices in Regional Victoria have grown 10% in the past 12 months, while apartment prices are up 13.5%, and there are many locations in Regional Victoria where prices have increased 15% or 20% or more in the past year.
This week we have published our Victorian Bundle – which comprises our Top 5 Melbourne Hotspots report and our Top 5 Regional Victoria Hotspots report.
We provide the two reports together at a discounted price so that you can access our ideas on the places to invest in one of the nation’s strongest capital city economies and in one of the most vibrant regional jurisdictions – indeed the one that has been the front runner of the most dominant trend in the country, the Exodus to Affordable Lifestyle.

https://www.hotspotting.com.au/product/vic-bundle/

One of the best ways to analyse and understand the nationwide real estate boom that’s currently sweeping Australia is to read Hotspotting’s bi-monthly newsletter, The Ryder Report.

This is a 25-page report which covers events and topics relevant to all corners of Australia.

And in this new April 2021 edition I explore some of the core issues, including the likely impact if the Reserve Bank changes its mind and decides to lift the official interest rate.

There’s a lot of media speculation about whether or not the RBA will lift the cash rate – despite its repeated statements that it won’t change the rate until 2024 at the earliest – and what the likely impact would be if it did so.

One of the reasons why economists and journalists are so fixated on the possible impact of an interest rate rise is because they think that low interest rates are the cause of the boom.

But they’re wrong. It’s not. There are multiple strong reasons why we have this strong nationwide upcycle.

I have 15 dot points on my list of growth drivers and in this edition of The Ryder Report I list those reasons.

Also in this edition of The Ryder Report, we publish excerpts of a report written by the man I regard as Australia’s best real estate research analyst, Simon Pressley of Propertyology.

He says that Australia has the best conditions for capital growth in 15-20 years and that it’s likely that property values will double in this five-year growth phase.

And there’s a whole lot more in this edition of The Ryder Report.

We analyse prices, we refute recent examples of media misinformation, we highlight specific growth markets, we provide special tips for investors, and we provide a state-by-state review of all the major events and issues in residential property across the nation.

So make sure you get your copy of the April edition of The Ryder Report, to ensure that you are fully-informed about the great Australian real estate boom.

When we consider property investing, location is usually at the forefront of people's minds. And for good reason. But is this the right starting point?

In this webinar, Hotspotting's Managing Director, Terry Ryder, and AllianceCorp's Managing Director, Jason Paetow delve into the other investment fundamentals to consider.

When building a property portfolio, our mindset needs to shift to property wealth planning - taking a broader approach - rather than honing straight in on locations. Through this process, we are able to determine which locations and what types of properties will ensure the best financial outcomes for clients.

The two leading property investment and location experts discussed the importance of the Portfolio Grade strategy and under what circumstances some locations are better than others. They also discussed a number of top locations for your portfolio, in the current rising market, taking into consideration a tailored strategy for each client.

Federal and state political leaders intend to generate an infrastructure-led economic recovery in Australia.

This will turbocharge the residential property boom which is already well under way across the nation.

Infrastructure spending is always a key driver of growth in residential property markets and government plans to fast-track shovel-ready projects will enhance the established trend of rising markets in many parts of Australia.

The research conducted daily by the Hotspotting team places considerable emphasis on announcements of major new infrastructure developments.

The best places to invest have impact from infrastructure in two key ways:

1 Existing infrastructure (public transport, schools, medical services, retail outlets, etc) and

2 Spending on new infrastructure.

New infrastructure is particularly influential on generating growth in residential property markets.

Our belief is that no other factor impacts property markets as strongly as major new infrastructure spending. That impact occurs both during construction and after the facility is completed.

Infrastructure such as new motorways, rail links, hospitals and universities improve the amenity and desirability of the locations directly impacted.

These projects generate major economic activity and employment – and from that flows demand for real estate.

From 2013 to 2017 both Sydney and Melbourne had significant real estate booms, but this was not replicated in other parts of Australia.

During that period, the markets in Perth and Darwin were in reverse, and those in Brisbane, Adelaide and Canberra were largely stagnating.

The fundamental difference - between the markets that were booming and those that were not - was the infrastructure spend.

Both Sydney and Melbourne were investing tens of billions of dollars on new infrastructure. As a consequence, the economies of the two biggest cities were strong, as a time when the other cities were weak or in decline.

We have seen major infrastructure spending transform local economies and their property markets in many significant regional cities across Australia. Projects totalling more than $20 billion have transformed the Sunshine Coast from a tourist town to an international city and it currently has one of the strongest property markets anywhere in Australia.

Newcastle, Geelong and Wollongong are all regional cities which have transitioned by older-style economies based on manufacturing to prosperous modern economies through spending on new infrastructure and the generation of new employment sectors. Growth property markets have emerged from the transition in these places.

For all these reasons, a new report created by Hotspotting is more important than most.

This report is titled: “Australia’s Infrastructure-led Property Boom: National Top 10 Hotspots”.

We’ve just published the new 2021 edition. It’s a report that encapsulates the essence of the national property boom.

So get yourself a copy today.

It’s puzzled many property observers in recent years. Why has Brisbane been so quiet? But not any more. Brisbane’s time to shine has arrived. Sales activity has soared in the past six months and prices are starting to rise. This dramatic change in the Brisbane market – from dormant to dynamic – is happening for clearly identifiable reasons. All the drivers that propel property markets forward are now in alignment. Brisbane is now one of the nation’s most compelling markets. It’s becoming recognised as the place to invest and a city ripe for new activity by property developers. The prospect of a Brisbane Olympics has made it even more enticing. Hotspotting founder Terry Ryder is hosting a special webinar event on Wednesday evening, 24 March, to discuss the perfect storm that’s gathering for a Brisbane real estate boom. The webinar will … • Explain why Brisbane’s time has come • Outline the key drivers of the Brisbane boom • Discuss the best places to buy • Identify opportunities for developers and investors • Launch a special “Why Invest In Brisbane?” report which will be made available to a limited number of businesses.

The current market presents a perfect storm for real estate investors if they buy sensibly in the right locations. In our free webinar on 17 March, leading investment expert Danny Buxton of Triple Zero Property Group will discuss why this is so with Hotspotting founder Terry Ryder. Vacancies are almost zero Rents are increasing Buyer demand is strong Prices are rising quickly The boom has longevity because there are multiple strong drivers. The key for investors is to find ways to "future proof" their investments. Buxton says investors need to be careful about where and what they buy, to ensure that they maximise their growth in the long-term. "It's not just about making money in the short-term," he says. "It's about making sure the growth is sustainable." Buxton will demonstrate, with recent case studies, how investors can achieve growth with new builds in the current market climate.

Regional Queensland right now is one of the nation’s leading boom markets.

It has more locations with rising sales activity than any other market jurisdiction in the nation, including all the capital cities.

There are growth markets up and down the Queensland coast, from the Gold Coast in the south to Cairns in the north, and heading inland to important regional cities like Toowoomba.

Perhaps the standout feature is the uptick in activity and prices in the past three or four months.

Three months ago, when I did our quarterly survey of sales activity, I found 72 locations in Regional Queensland with upwardly mobile markets.

With our new survey just completed, I found 157 growth markets.

In other words, the already-high number of rising markets has doubled in three months.

This is a stunning outcome – and it means that, in a nation that’s having a nationwide property boom, Regional Queensland is the leader of this dramatic event.

At the same time, eight out of ten locations have recorded growth in their median prices in the past 12 months – many of them with double-digit price growth.

There are multiple reasons why this is happening – but a key catalyst is the reality that Queensland is a natural beneficiary of the Exodus to Affordable Lifestyle trend which is sweeping the nation.

All this has made it a difficult task to select the locations to include in our new 2021 edition of Top 5 Regional Queensland Hotspots report which we’re publishing this week.

It’s very much a question of what to leave out.

And it means that the locations that are included are markets well worthy of your interest and attention.

So get a copy of the new 2021 edition of Top 5 Regional Queensland Hotspots report and discover some of the places I expect to be at the forefront of the Australian property boom.

Some of the investors and others jumping into the rising property boom are buying without care and due diligence.

The property market has seen a dramatic turnaround following a COVID-19 induced downturn in 2020. How long will this next boom last? And what is driving the market?

In this live webinar we will be discussing a range of locations in Sydney, Melbourne, Brisbane and Newcastle that investors should consider for their next investment. We will also be looking at the drivers in the economy and uncover the potential pitfalls that could wobble the property market.

Multi-award-winning Buyers’ Agent Rich Harvey, CEO of Propertybuyer and respected researcher and commentator Terry Ryder Founder of Hotspotting.com.au reviewed a range of topics that you must hear.

They discussed:

• Are we at the start of another property boom? • How should buyers approach a rising market?

• What will transpire after March, once job-keeper finishes?

• Where should I be investing for the best capital growth and cashflow yields?

• What trends has covid set in motion that will continue well into the future? • When will listing volumes start to rise – what is holding vendors back?

• What impact have expats returning had on the property market? • Is the exodus to affordable lifestyle going to continue once the vaccine is in place? • Is now a good time for investors?

The strongest trend to impact Australian real estate in the 21st Century is currently sweeping the nation.

The Exodus to Affordable Lifestyle is creating growth is regional cities and towns which is out-performing the big cities.

The fringe areas of major cities, regional cities, hill change towns and sea change enclaves are all beneficiaries of this compelling trend.

While property prices have been muted in the two biggest cities, smaller cities and regional locations are experiencing strong demand and price uplift.

Ultra-low vacancy rates are another element of the strength of these markets, putting upward pressure on rents and creating higher yields.

The Exodus trend has been driven by technology and improved transport links, as more and more people realise the possibilities of working remotely – and thereby being able to escape the big, expensive, congested cities.

It was a rising tide before the pandemic, with increasing numbers of Australians realising the possibilities of working from home.

The Covid-19 lockdowns have enhanced a trend that was already under way, turning a steady drift into a stampede, by opening the eyes of more Australians to the potential.

The pandemic has supercharged an established trend, making it the driving force of markets across Australia.

The trend was first visible in Regional Victoria with people retreating to hill change towns within 1-2 hours of Melbourne. Locations close to Sydney were also feeling it.

Then the impetus rippled further out to regional centres more distant from the capital cities. It has reached as far north as Darwin, where Melbourne residents and others have headed for the relative safety and affordability of the northern capital (plus the warmer climate).

Before the pandemic, Queensland was already on the relocation wish-lists of many interstate buyers. Now, with many people now working remotely, there is a growing herd migrating north.

At Hotspotting we have been strongly advocating good regional centres for investment for the past three years.

And in October 2020 we published the first edition of our National Top 10 Exodus to Affordable Lifestyle report. It quickly became one of our most popular products.

And this week we published our new 2021 edition of the report.

It outlines our Top 10 picks of locations expected to rise on the back of this trend.

And, because there are so many places with potential for strong growth, we include a B List of 10 locations which missed the cut for the Top 10.

So get yourself a copy of the new 2021 edition of the Exodus to Affordable Lifestyle report – and have a read of it today.

Depreciation expert Peter Foldes of Washington Brown Depreciation and Hotspotting founder Terry Ryder presented a webinar last February 17th that gave you a comprehensive overview of property depreciation in 2021.

New and existing property investors need to maximise their returns and depreciation is often a neglected area. With legislative changes at both federal and state levels, keeping on top of your entitlements is paramount.

Vacancy rates in our already-tight rental markets fell in six of the capital cities and were unchanged in the other two in January, according to the monthly report from SQM Research.

The national average vacancy rate fell from 2.2% in December to 2% in January, but five capital cities – Perth, Adelaide, Canberra, Darwin and Hobart – all have vacancy rates below 1%, while Brisbane sits at 1.7%.

Throughout regional Australia, many centres have vacancy rates below 1% in what represents a national rental crisis for people seeking tenancies.

The industry benchmark is that vacancy rates below 3% represent a shortage of rental properties.

The two biggest cities, where vacancies are highest, showed marked improvements in January, with Sydney falling from 3.6% in December to 3.2%, and Melbourne falling from 4.7% to 4.4%.

SQM CEO Louis Christopher says the figures provide more evidence the worse is over for landlords in the Sydney and Melbourne rental markets.

He says: “The falls in vacancy rates for the month in those two cities, combined with the increased tightness in other cities and regions, has now brought rental vacancy rates down to below where they were prior to the outbreak of Covid19.”

Christopher says the data suggests that 2021 will remain largely a tenant’s market in the inner city areas “but will also very much remain a landlord’s market for regional Australia”.

He also notes that rents for both houses and units have risen in the capital cities, on average, over the past month.

In annual terms, the national average is a 10% rise in house rents and a 4% increase in apartments rents.

The growth has been higher in regional markets than in the capital cities, with Sydney and Melbourne rents still lower on average than a year ago.

But there have been strong rises in Perth, Canberra and Darwin.

In Perth, rents have risen 11.5% for houses and 12.3% for apartments, while in Darwin house rents have increased 27% in 12 months. In Canberra rents have risen around 6% for both houses and units.

Here’s how you spot a real estate charlatan, someone who likes to present themselves as a real estate expert but who in reality knows nothing worth hearing …
1. They speak of Australia as a single property market; and/or
2. They attribute price growth to “record low interest rates”
Mostly these pretenders are economists. I would remind you of a much-quoted definition of an economist: Someone who can tell you tomorrow why their predictions yesterday didn’t come true today.
We have learnt over the years, but particularly in 2020, that the bigger the name and the media profile, the worse they are at analysing residential real estate and forecasting outcomes.
Cast your minds back to the predictions in March/April 2020 from senior economists employed by the major banks, big institutions like AMP and even those working for specialist real estate research entities. And then again later in the year when the so-called
September Cliff was proclaimed an impending disaster.
There was a chorus of predictions of a long recession, with double-digit unemployment and real estate values collapsing. How spectacularly wrong they were. Only the specialist property analysts got it right.
But the appalling track record of economists with real estate analysis stretches back years and includes the alarmist predictions about property prices in the wake of the GFC – also proven to be spectacularly wrong.
It’s remarkable that media continues to give these charlatans airplay. Credibility, it seems, is optional, so long as you have “economist” in your title. So the nation’s gaggle of chattering economists has been compelled to admit they got it wrong in 2020 and most of them are now forecasting big price growth this year. You will note that what they are predicting is already happening, highlighting another characteristic of this bloated and overblown profession: predicting the recent past.
And how do they explain the gathering boom? Record low interest rates!
God help us. The lack of expertise among the talking heads who clutter up the airways with their simplistic analysis is quite breathtaking.
As we all know, we’ve had ultra-low interest rates for years. Very little has changed in that regard to explain the recent uplift in sales activity. When Sydney and Melbourne were having their real estate boom from 2013 to 2017-ish, economists generally explained the price rises with “record low interest rates”. They had no response to the obvious question at the time: how come prices in Perth and Darwin were falling, while Canberra, Brisbane and Adelaide were stagnating?
The “low interest rates = property boom” theory also fails to explain why the last two genuine nationwide property booms, in the late 1980s and in the early years of this century, both occurred during periods of very high and rising interest rates.

My view, strongly, is that record low interest rates do not explain what’s happening in real estate across most of Australia.
The growth is being fueled by multiple factors, including …
 A stronger-than-expected economy
 Lower-than-predicted unemployment
 State and federal stimulus measures
 The build-up of savings during the pandemic period
 People in lockdown reviewing their life choices
 Ultra-low vacancies, putting upward pressures on rents and prices
 Pent-up demand, leading to rising sales activity
 Low listings levels, relative to rising buyer demand
 The Exodus to Affordable Lifestyle trend, which is hugely influential
 Increased spending on major new infrastructure
 The revival of the resources sector
 The return of ex-pat Australians in large numbers
 The belated entry of investors to compete with owner-occupiers
 Perceptions about the safety and solidity of bricks & mortar in times of uncertainty
 The growing prevalence of e-commerce and its impact on industrial property, which
has repercussions for residential demand
 Access to low-cost finance
And you’ll notice that I mention low interest rates as just one of 16 different factors – and I mention it last and definitely least.

National buyers agent Kate Hill of Adviseable and Hotspotting founder Terry Ryder presented a webinar today where participants asked their most urgent questions about real estate in 2021. They discussed prospects for a nationwide property boom this year and beyond, where markets are heading, which ones will show the best growth, and which ones to avoid. Kate Hill and the team at Adviseable range across Australia seeking the best properties for their clients, while Terry Ryder and the Hotspotting team devote every working day to researching markets across the nation. They are uniquely placed to provide an informed perspective on markets of all kinds throughout Australia.

Adelaide is consistent with its sales activity and it delivers steady price growth. It recorded growth in its house prices in 11 of the 12 months of 2020 and overall had a 6% increase in the city’s median price. The results of our latest quarterly survey of sales volumes in Adelaide are almost identical to those of the past three years. We have identified 62 suburbs with rising sales activity, similar to most of the past 10 surveys. And, once again, the data shows that this consistent performance is occurring right across the Adelaide metropolitan area. There are 10 municipalities with at least three suburbs with rising sales momentum. Affordable locations are the market leaders, boosted by the strong activity of first-home buyers.

Our analysis of the price data for individual suburbs shows that two-thirds of Adelaide locations recorded growth in the past 12 months. And a highest percentage, 70%, had house price growth in the most recent quarter. Suburbs recording above average growth in the past year are scattered across the Adelaide metropolitan area, covering a range of price points.

We’ve just published our new 2021 edition of the Top 5 Adelaide Hotspots report. It’s a good report to read in the current climate because Adelaide is well-placed to provide consistent growth this year.

Find out the best areas for growth in our latest Top 5 Adelaide Hotspots 2021 report.

New data from two sources confirms that a national real estate boom is under way across Australia. The latest figures from both Domain and CoreLogic record annual growth in house prices in most locations in the nation, but in particular in the latest quarter. CoreLogic’s 1 February price report shows that all 15 market jurisdictions (eight capital cities and seven state regional precincts) recorded uplift in the month of January and in the three months to the end of January. Domain’s price report published last week shows all eight capital cities had significant price increases in 2020, with particularly major uplift in the December Quarter. The CoreLogic figures show quarterly growth of at least 2.4% in all 15 of the major market jurisdictions. That equates to double-digit increases over the coming year if those growth rates are maintained. But 12 of the 15 major markets had quarterly increases ranging from 3.5% to 7.8%. The Domain data shows quarterly rises in house prices ranging from 3% to 6.4% in five of the eight capital cities and equally significant increases throughout many regional locations. The smaller capital cities and the regional markets are leading the growth in house prices. In annual terms, according to CoreLogic, Darwin (15%), Canberra (9.5%), Hobart (8%) and Adelaide (7%) are all out-performing, while the regional markets of Tasmania, South Australia, NSW and Queensland have all increased by between 8% and 12.5%. The growth is being fuelled by multiple factors, including …  A stronger-than-expected economy  Lower-than-predicted unemployment  State and federal stimulus measures  Ultra-low vacancies, putting upward pressures on rents and prices  Low listings levels, relative to buyer demand  The Exodus to Affordable Lifestyle trend  Increasing spending on major new infrastructure  The return of ex-pat Australians in large numbers  The belated entry of investors to compete with owner-occupiers  The safety and solidity of bricks and mortar in times of uncertainty  Access to low-cost finance And you’ll notice that I mention low interest rates as just one of a dozen different factors – and I mention it last and definitely least. That’s contrary to Australia’s gaggle of chattering economists who seem to think that low interest rates is the only factor causing prices to rise – which, frankly, shows how little the members of that over-rated profession really understand about real estate markets. Bye for now.

Regional NSW is showing nation-leading strength, with a record number of towns and suburbs recording growth in their sales activity in our new quarterly survey. A total of 116 locations have rising markets, easily the highest number in the six years that Hotspotting has been conducting its quarterly surveys.

Markets across Regional NSW continue to perform at nation-leading levels on price growth. In the past 12 months, 90% of regional locations have recorded growth in their median house prices. Most have lifted at least 5% and many have had double-digit growth.

The results show evidence of the Exodus to Affordable Lifestyle trend which is sweeping the nation, with growth markets right across the state but most noticeably in places close to Sydney.

And we highlight the best of these regional centres in the new edition of Top 5 NSW Regional Hotspots.

The report provides a range of options for investors to buy affordably in areas which offer good rental yields, backed by low vacancies, and which have continued to deliver price growth through the pandemic period.

Some parts of Australia have low vacancies. But others, notably in the inner-city areas of our major cities, have large numbers of empty properties.

The question for many landlords is: what’s the best way forward when past strategies aren’t working and it’s hard to achieve good rentals and acceptable returns?

The best answer is to consult the experts. And on Thursday 21 January, Hotspotting will present a webinar featuring property management expert Jo Natoli of The Rental Specialists.

Jo will be speaking to Hotspotting founder Terry Ryder to discuss the best strategies for real estate investors facing difficult situations.

Jo and Terry will discuss …

• How to find tenants when vacancies are higher than usual • How to maximise your rental return • How to set up your property to get the best results • Why a good manager is the best investment when times are tough.

At Hotspotting we think these are key issues to focus on, as we launch our webinar series for 2021.

Places that offer both affordability and lifestyle are at the forefront of real estate dynamics across Australia at the moment.

First-home buyers comprise the most active cohort in the market – and the first thing that young buyers are seeking is affordability.

If an affordable location also offers good infrastructure and proximity to major employment nodes, then so much the better.

There is another significant cohort in the market – owner-occupiers wanting to exit the inner-city areas, having made the decision to work remotely, and seeking places that offer a different lifestyle at a more affordable price.

For investors, this is news you can use.

The locations that are being targeted by these other cohorts seeking affordable options are the ones that are showing the best growth at the moment.

Investors were, for the most part, sitting on the sidelines in 2020 but now it’s time for them to get into the market.

There’s a broad consensus among analysts and commentators that we are going to see significant price growth in 2021.

I’m expecting a nationwide property boom in 2021 and beyond – and locations with good infrastructure which offer affordability will be at the forefront of the growth.

So, it’s timely that we are now publishing our Cheapies with Prospects Bundle.

This comprises two Top 5 reports – the City edition and the Regional edition – which jointly focus on 10 key locations which offer an attractive level of affordable buying options and, importantly, the key drivers for price growth.

If you’re an investor thinking of getting into the market this year, to take advantage of the growth that’s coming, this is the right product to get.

The Cheapies with Prospects bundle provides the guidance you need to buy well – ahead of the boom that’s building across Australia.

Sydney markets have defied the pandemic recession, with notable uplift in sales activity and prices in 2020. Our quarterly survey for the Summer edition of The Price Predictor Index has identified more growth markets than at any time in the six years of these surveys. In our survey six months ago, we could find only 24 suburbs with rising sales momentum across the Greater Sydney area - and 31 suburbs ranked as declining or danger markets. Now we find 93 suburbs with rising sales activity - and the number of declining or danger markets has halved. There are two distinct sectors doing well across the Greater Sydney area: the upper end of the market and the outer-ring areas where first-home buyers and other budget owner-occupiers have been busy. The more expensive sector is being led by the Inner West and the Northern Beaches. Other top end precincts with buoyant markets include the municipalities of Woollahra, Waverley and Randwick. A few tiers below those markets price-wise, Sutherland Shire continues to show signs of being an up-and-coming market. The more affordable parts of the Sydney metro area are also buoyant. Out west, the Blacktown and Penrith municipalities both have seven suburbs with rising sales activity, while in the south-west the Camden and Campbelltown LGAs jointly have 12 rising suburbs. Our analysis of price trends across the Sydney metro area tells a story of stubborn resistance to the forces of the pandemic. Most suburbs have delivered growth in their median house prices in the past 12 months – and most also have had growth in the most recent quarter, amid the pandemic period. So, against that positive background, we have published our new 2021 edition of the Top 5 Sydney Hotspots report. We’re predicting a nationwide real estate boom in the coming year and we expect Sydney to be part of it. So have a read of our new Top 5 Sydney report and find out where we think the best places to buy can be found.

We’ve just put together the new 2021 edition of our most popular report, the National Top 10 Best Buys.

It’s very timely – because we’re coming to the end of the most remarkable year most of us have experienced …

And, in real estate terms, we’re about to enter what I expect to be most dynamic year ever.

We’re ending 2020 with prices growing in most locations across Australia and building towards a nationwide real estate boom, I believe.

Because there are so many vibrant markets across Australia right now, I’ve found it extremely difficult to make the necessary choices for this new edition of the Top 10 Best Buys report.

There are so many genuine candidates for inclusion in capital cities and in regional areas around the nation.

It means that many worthy locations, places that I expect to show good growth in 2021 and beyond, have not made the cut.

But I’ve come up with a Top 10 list that includes a mix of big cities and regional centres – with locations in five different states.

They’re all places with identifiable strong growth drivers.

They’re all places that are representative of the major trends that are sweeping the nation, including the Exodus to Affordable Lifestyle and the Infrastructure-led Property Boom that’s coming.

It’s not only our most popular report – I expect this edition to be most important we have published, given everything I expect to happen in the year ahead.

We’ve just published our two major hotspots for Queensland – Top 5 Brisbane and Top 5 Regional Queensland – at a time when many of these markets are on the cusp of a real estate boom.

The Brisbane market has shrugged off the impacts of the pandemic and is in its strongest position to generate price growth for five years. This is starting to translate increasingly into evidence of uplift in property values.

Our analysis of sales activity across the Brisbane metropolitan area has identified 56 suburbs with rising momentum, the highest number since late in 2015 and double the number identified in our survey six months ago. The numbers show an all-round improvement in the Brisbane market, with a sharp reduction in the number of declining or danger markets.

Brisbane’s affordability relative to the biggest cities is helping to boost its market, with more people relocating to South-East Queensland from Sydney and other parts of Australia. Brisbane is a natural beneficiary of the Exodus to Affordable Lifestyle trend and is also benefiting from strong consumer confidence as a result of the success in controlling Covid-19.

We’re also seeing very positive trends in the state outside of Brisbane. Indeed, this is the strongest Regional Queensland market in the six years we have been conducting our quarterly surveys of sales activity and prices. The number of rising markets is the highest recorded, by a considerable margin, and property values are growing.

We have identified 72 locations with rising sales activity, a remarkable result in the year of the pandemic. Locations across the state are benefiting from the Exodus to Affordable Lifestyle and/or the improvement in the resources sector.

Vacancies are ultra -ow in most of these places. There are seven regional cities with five or more suburbs with forward momentum in sales activity: the Sunshine Coast, the Gold Coast, Toowoomba, Mackay, Rockhampton, Gladstone and Townsville. These cities, plus smaller regional centres like Gympie, Emerald, Warwick, Kingaroy and Dalby, all have markets trending in the right direction for sustained price growth.

The Sunshine Coast is again the standout location, but other regional markets are emerging, notably the important inland city of Toowoomba. And we are seeing recovery in resources-related centres which have spent several years in downturn, including Gladstone, Mount Isa and Emerald.

So the best way to find out which are the best markets to focus on in Brisbane and Queensland – and why – is to get our Queensland Bundle. It includes Top 5 Brisbane and Top 5 Regional Queensland and is a great way to make some decisions about where you might buy in 2021.

Seven of the eight capital cities delivered growth in their house prices during 2020, according to the latest data from CoreLogic.

The price increases were highest in Darwin, which grew 12% last year, followed by Canberra’s 8.5%, Hobart’s 7.7% and Adelaide’s 6%. Melbourne was the only city to record a decline in its median house price, down 2% in 2020.

Sydney (up 4%), Brisbane (4.6%) and Perth (2%) all recorded moderate growth in their house prices, in a year when most of the nation’s cities defied the pandemic and its negative economic impacts.

The average growth figure for the combined capitals was reported by CoreLogic as 2.6%, a number that seems unreasonably low given that six of the eight cities had growth considerably higher than that.

Apartment markets did not fare as well as houses, with four cities delivering price growth, two recording no change and two (Brisbane and Sydney) having small declines in their median un it prices. The combined cities average was a rise of 0.2% in 2020.

So the capital cities did pretty well in the pandemic year, especially the smaller ones …

BUT …

Regional property markets across Australia out-performed the capital cities – and by a considerable margin.

CoreLogic data shows that the result for the Combined Regions was a rise of 7% for houses and 6% for units, compared to 2.6% and 0.2% for the Combined Capital Cities.

House prices rose 12% in Regional Tasmania (compared to 7.7% in Hobart),

8.8% in Regional NSW (compared to 4% in Sydney),

7.8% in Regional South Australia (compared to 6% in Adelaide),

7.3% in Regional Queensland (compared to 4.6% in Brisbane) and

5.5% in Regional Victoria (compared to a 2% decline in Melbourne).

Unit markets also did well in the regions, with price increases headed by South Australia (up 11.7%) and Tasmania (up 10.5%).

NSW, Victoria and Queensland all recorded unit price rises between 5.5% and 6.5% in the regional areas.

The only regional market to record price decline was Western Australia, which dropped both for houses and for units.

So, overall, an amazingly positive result for property prices in a year that threw up all kinds of hurdles – and in defiance of the negative predictions by economists and journalists.

All this was achieved without a great deal of involvement from investors.

And that’s one of the things that will be different this year.

Stand by for a big big year in residential real estate in 2021.

The year of the pandemic has been a very good advertisement for residential property as an asset class. And our new Summer edition of The Price Predictor Index demonstrates the point well. Our analysis of sales activity and prices in capital cities and regional markets across Australia has revealed a series of highly positive outcomes – pointing to strong price growth in 2021. Many jurisdictions have had the best results on sales trends we have seen in the six years we have been conducting our quarterly surveys, including Sydney, Perth, Regional NSW, Regional Queensland and Regional WA. Brisbane has had its best result since 2015. Other precincts have done outstandingly well with prices. In Regional Victoria, 92% of suburbs and towns have had growth in their median prices in the past 12 months. In Hobart and Tasmania, 90% of locations have delivered growth, while 80% of towns in Regional South Australia have grown their prices and 81% of Canberra suburbs have had uplift. Looking at it from another perspective, Canberra and Regional Tasmania have both had some level of house price growth in every one of the past nine months (i.e. since February, when the pandemic struck the nation), while Adelaide, Regional Queensland and Regional NSW have all had growth in eight of the nine months. One of the dominant themes in this edition of The Price Predictor Index is the trend of people relocating from the biggest cities to more affordable locations that offer lifestyle. This trend has been gathering speed for a number of years and has been enhanced by the pandemic period, with its enforced lockdown phases. Regional areas in particular have attracted increased demand as a result of this pattern. In the most populous states - NSW, Victoria and Queensland - the regional jurisdictions have out-performed their capital cities on the number of suburbs or towns with rising sales activity. Sydney had a record 93 growth markets in this quarterly survey, but Regional NSW had more, with 116. Melbourne has been outdone by Regional Victoria and Brisbane has been bettered by Regional Queensland. Collectively in those three states, the regional jurisdictions had a total of 223 growth markets, compared to 174 growth suburbs in the capital cities. Regional towns have also excelled in South Australia, Tasmania and Western Australia. Sales activity is rising and prices are responding. What started as a steady drift of people moving from the big cities to the smaller cities or to regional areas has turned into something approaching a stampede. We know from other research that first-home buyers are one of the most active cohorts in the market. The lending data shows the market share of FHBs is the highest in more than 10 years. This is reflected in the results of this quarterly survey. In many of our capital cities, the best results in terms of the number of suburbs with upward momentum have been the cheaper areas. Those are just some of the highlights of this new Summer edition of the Price Predictor Index. It’s one of our most popular reports because it provides a reliable forward indicator of what’s likely to happen with property prices in every significant suburb and town across Australia. It includes our National Top 50 list of Supercharged suburbs and our National Top 50 list of the most consistent markets in the nation. It highlights the Top 10 municipalities in Australia in terms of uplift in sales activity heading towards strong price growth.

So get yourself a copy of the new Summer edition of the Price Predictor Index to find out what’s going to happen in real estate across Australia in 2021.

Melbourne’s unique situation in the year of the pandemic has delivered a markedly different outcome to many other locations.

The second wave lockdowns and restrictions have meant that the Melbourne market has had to deal with difficulties that other cities and regions have not experienced.

But, despite everything, the Melbourne market has managed to get through to December without any major damage to prices or consumer sentiment.

The latest price data from CoreLogic suggests that in the 12 months to the start of December, the median unit price has risen marginally – 0.4% - and the median house price is down slightly, just 1.5%.

But the latest figures out this week from SQM Research suggest that houses have risen 1.8% in the past 12 months and units have increased 4.5%.

Those are remarkably strong statistics for a market that has experienced all that has afflicted Melbourne in 2020.

So, against that backdrop, I’m expecting a strong performance from Melbourne markets in 2021.

We’ve already seen, in the short time since the restrictions were lifted by the State Government, evidence of busy activity in property markets and some strong sales.

So, as we contemplate what might happen in Melbourne in the New Year, where should investors be buying?

To answer that question, this week we have published our new Top 5 Melbourne Hotspots report, to provide our best insights into what to expect in 2021 and where best to focus your attention.

I think Australia will experience a national real estate boom in 2021 and Melbourne will be part of it.

To find out more, have a read of our new 2021 edition of Top 5 Melbourne hotspots.

In this short episode, Terry discusses what is happening in the property market right now with Tom Wood from SC Lawyers and Danny Buxton from Triple Zero Property.

In this short audio, Terry discusses the idea of diversifying when an investor is unsure of the area, with Tom Wood from SC Lawyers and Danny Buxton from Triple Zero Property.

Every capital city and every regional market recorded house price growth in November, according to the latest data from CoreLogic.

Nationally house prices rose 1.1% in November, led by a 1.4% in regional markets which continue to out-perform the capital cities.

Apartment markets rose 0.2%, again headed by a 1.4% increase in the regions.

The results continue the strong performance of most property markets across the nation during this year of the pandemic.

Of the 15 major market jurisdictions in Australia (eight capital cities and seven regional markets), 13 have recorded house price growth in the past 12 months, the only exceptions being Melbourne and Regional WA.

All of the markets except Brisbane have also recorded annual growth in the median apartment prices.

In November, house price growth was led by a 2.2% rise in Canberra, with Regional Tasmania up 1.8%, Hobart up 1.7% and Darwin rising 1.6%.

The annual growth in house prices has been headed by Regional Tasmania (up 10.6%), Darwin (up 9.1%), Canberra (up 7.8%) and Regional NSW (up 7.4%).

Regional markets continue to outdo the capital city markets. The growth in house prices has been greater in the regions in the past month, the past quarter, the year to date and in the past 12 months.

In the past year, regional house prices on average have risen 5.9%, compared to 2.9% in the capital cities. Regional unit prices on average are up 4.7%, compared to 0.8% in the cities.

And of course, individual markets have done considerably better than those average numbers.

So the CoreLogic data published today is the latest in a series of reports which show how well real estate markets have done in the year of the pandemic.

2020 has been the best possible advertisement for residential real estate as an asset class.

It was predicted by many that prices would collapse this year, but in virtually every capital city and regional market, they have risen.

And next year, I’m expecting similar but even more so.

The nation-wide property boom I’m predicting is already under way in many locations across the nation.

Brisbane In Strongest Position In 5 Years To Deliver Price Growth

The Brisbane market has shrugged off the impacts of the pandemic and is in its strongest position to generate price growth for five years. This is starting to translate increasingly into evidence of uplift in property values.

Our analysis of sales activity across the Brisbane metropolitan area has identified 56 suburbs with rising momentum, the highest number since late in 2015 and double the number identified in our quarterly survey six months ago.

The numbers show an all-round improvement in the Brisbane market, with a sharp reduction in the number of declining suburbs and a reduction also in the number of danger markets.

Brisbane’s affordability relative to the biggest cities is helping to boost its market, with more people relocating to South-East Queensland from Sydney and other parts of Australia. Brisbane is a natural beneficiary of the Exodus to Affordable Lifestyle trend and is also benefiting from strong consumer confidence as a result of the success in controlling Covid-19.

In the six years we have been conducting our quarterly surveys of sales activity and prices, it has been common for northern Brisbane to dominate the positive results – and that is certainly the case in this Summer 2020 survey. Of the 56 suburbs with rising sales activity, 12 are in the Brisbane-north precinct of the Brisbane City Council area and 13 are in the neighbouring Moreton Bay Region.

While the most prolific markets are in the north, there also has been a notable revival in Logan City in the south. The municipality is the urban bridge between Brisbane City and the Gold Coast and traditionally attracts buyers seeking cheap real estate and good infrastructure.

There are growth markets in other parts of the Greater Brisbane area as well – Brisbane-inner (4), Brisbane-east (5), Brisbane-south (3) Brisbane-west (3) and Redland City (5) all have some suburbs with rising sales activity.

Our analysis of price trends across the Brisbane metropolitan area shows that most suburbs have recorded house price growth in the last 12 months, but an even higher percentage have had growth in the most recent quarter.

This again shows that the city has done well through the pandemic period.

Our latest Top 5 Brisbane Hotspots include the areas that we have identified as those with the best prospects for returns and future capital growth. These recommendations are based on exhaustive analysis of the data and Terry Ryder’s 35+ years of experience as a property analyst.

Discover Terry’s recommendations in the Top 5 Brisbane Hotspots.

In this short video, Terry discusses the possibilities of buying an investment property in our own neighbourhoods with Tom Wood from SC Lawyers and Danny Buxton from Triple Zero Property.

In this short episode, Terry discusses some of the common mistakes made when buying an investment property with Tom Wood from SC Lawyers and Danny Buxton from Triple Zero Property.

A real estate boom is under way across Regional Australia, although it's been largely overlooked by mainstream media.

Regional cities and towns have been outperforming capital cities on price growth, as well as vacancy rates and rental uplift, for several years.

The trend has been turbocharged by the pandemic, with regional economies relatively untouched by the virus and property markets boosted by city residents relocating to affordable lifestyle areas.

To discuss why the regions are delivering stronger markets than the big cities, and which areas are poised for big growth, watch Hotspotting founder Terry Ryder and property investment expert Tim Graham of Reventon in this free webinar, where they will explain why the best regional areas present a win-win-win scenario for investors:

lower price points,
higher rental yields and
better prospects for growth.

The Covid-19 pandemic has provided commercial property investors with the best kind of market research. It has demonstrated what works in times of economic downturn. It has shown investors which types of commercial tenants can do well during the pandemic period and continue to provide investor owners with the key appeal of this type of property – a high level of positive cash-flow.

The past 6-7 months has provided a check-list of the types of tenancies commercial investors should seek – the ones that perform in good times and bad. In this special webinar event Hotspotting founder Terry Ryder was joined by Australia’s leading expert on commercial property for small investors, James Dawson of the Commercial Investing Academy.

James presented a series of case studies to illustrate the type of commercial investments which have not only survived but thrived in the pandemic period.

In this episode,Terry discusses the first thing investors need to do with Tom Wood from SC Lawyers and Danny Buxton from Triple Zero Property.

The latest price data from SQM Research, Domain and from CoreLogic shows a strong performance by house prices right across Australia.

I’m predicting a national property boom in Australia in the near future and the latest figures from these three major sources confirm that the strong up-cycle is already under way in many parts of the nation.

The Domain figures show that every capital city had growth in their median house prices in the September Quarter - except Melbourne where there was no change.

Apartment markets have been less bullish, and some capital cities have dropped (impacted by high CBD vacancy rates in the big cities), but even there the national averages are a 0.1% rise in the September Quarter and a 2.2% rise annually.

The numbers overall are quite remarkable amid a pandemic-induced recession.

In the September Quarter, house prices grew by 2.8% or more in four of the capital cities: Adelaide, Hobart, Darwin and Canberra.

Hobart rose 6.9% and Darwin by 6.6% - in the September Quarter alone.

Many readers will be scratching their heads. We never hear about these markets, do we?

We hear a lot about Sydney and Melbourne, but when’s the last time you read an article about the strong Adelaide housing market or Canberra property prices.

How many are aware of the strong recovery under way in Darwin and also in Perth.

In annual terms, all capital cities have house prices higher than a year ago.

The national average is a rise of about 5% but individual cities have done much better. Hobart house prices are 16% higher than a year ago and Canberra is up 10%. Sydney, Adelaide and Darwin have all risen 7%.

This reflects what we have observed month-by-month since the start of the pandemic, based on CoreLogic figures.

Sydney and Melbourne have had numerous months in which house prices have dropped but the other capital cities have had growth months most of the time.

Canberra has produced house price growth in each of the past eight months and Adelaide has had growth in seven of the eight months since February.

Perth, Brisbane and Darwin recorded some down months, but bounced back in August, September and October, with Darwin showing particularly strong figures.

Most regional markets have had sustained growth throughout the pandemic period since February, with Regional Tasmania delivering growth in every one of the past eight months, while Regional Queensland and Regional NSW delivered uplift in seven of the eight months.

This strong showing by Regional Australia is seen also in the Domain figures just published. Despite the overall positive performance in the capital cities in the September Quarter, the capitals were out-performed by the regional markets.

Domain reports that many regional markets have seen double-digit increases in their house prices, with some rising as much as 30%.

Regional markets in Victoria, NSW, Tasmania and Queensland all have outstanding growth performances.

Among the best have been the Southern Grampians in Victoria (up 31%), the Byron Bay region in NSW (up 29%), Forbes in NSW (up 22%), the Isaac LGA in Queensland (up 23%) and the Derwent Valley in Tasmania (up 28%).

My own price analysis in recent weeks confirms strong regional uplift, with notable growth in the top end of the Sunshine Coast market, with some suburbs up about 30% in annual terms.

Now this week we had the weekly report on prices from SQM Research.

It shows that all eight capital cities have recorded growth in house prices in the past month and seven of the eight have had annual price growth.

SQM’s Prices Index shows that the national average was a 2.3% rise in the rolling month index (the month to 10 November) and a 5.6% increase in annual terms, with regional areas showing better growth than the capital cities.

The monthly increases by the eight capital cities were headed by a 2.9% rise in Hobart and a 2.2% rise in Sydney. Perth was up 1.7% and Brisbane 1.2% for the month. Melbourne returned to growth with a 0.4% monthly rise.

In annual terms, Hobart leads with a 10% increase in house prices, while Melbourne is up 7% and Sydney 6%.

Now think about it. We’ve all seen the headlines, which were particularly strident in March and April, forecasting a collapse in property prices.

But residential property has not collapsed. It has done rather the opposite. Prices are rising in most locations around Australia.

The national property boom I’m forecasting is already under way in many parts of the nation.

And the infrastructure-led economy recovery planned by federal and state politicians will turbocharge this trend.

Stay tuned.

Federal and state political leaders intend to generate an infrastructure-led economic recovery in Australia.

That will turbocharge a residential property boom which is already building across the nation.

And that is why we have created a new report called “Australia’s Infrastructure-led Property Boom – National Top 10 Hotspots”.

Infrastructure spending is always a key driver of growth in residential property markets and government plans to fast-track shovel-ready projects will enhance the established trend of rising markets in many parts of Australia.

The research conducted daily by the Hotspotting team places considerable emphasis on infrastructure.

The best places to invest have impact from infrastructure in two key ways: excellent existing infrastructure (public transport, schools, medical services, retail outlets, etc) and spending on new infrastructure.

New infrastructure is particularly influential on generating growth in residential property markets.

Our belief is that no other factor impacts property markets as strongly as major new infrastructure spending.

Infrastructure such as new motorways, rail links, hospitals and universities improve the amenity and desirability of the locations directly impacted.

These projects generate major economic activity and employment – and from that flows demand for real estate.

From 2013 to 2017 both Sydney and Melbourne had significant real estate booms, but this was not replicated in other parts of Australia.

During that period, the markets in Perth and Darwin were in reverse, and those in Brisbane, Adelaide and Canberra were largely stagnating.

The fundamental difference was the infrastructure spend. Both Sydney and Melbourne were spending tens of billions of dollars on new infrastructure. As a consequence, the economies of the two biggest cities were strong, as a time when the other cities were weak or in decline.

We have seen major infrastructure spending transform local economies and their property markets in many significant regional cities across Australia.

Projects totalling more than $20 billion have transformed the Sunshine Coast from a tourist town to an international city and it currently has one of the strongest property markets anywhere in Australia.

Newcastle, Geelong and Wollongong are all regional cities which have transitioned by older-style economies based on manufacturing to prosperous modern economies through spending on new infrastructure and the generation of new employment sectors. Growth property markets have emerged from the transition in these places.

The recent Federal Budget provided evidence that the Australian Government intends the past-pandemic economic recovery to be largely inspired by spending on major projects across the nation.

It’s also clear that State Governments are ramping up their spending on roads, rail links and other projects to generate jobs.

So in our new report on “Australia’s Infrastructure-Led Property Boom”, we highlight ten locations which are poised for growth as a result of big spending on new infrastructure.

More potential hotspots will emerge as governments firm up their plans and announce start dates for major developments.

But, for now, these are the locations we think will receive the greatest uplift in the short-to-medium term.

So, get yourself a copy of this new report – and, if you have any questions, email me on ryder@hotspotting.com.au.

Bye for now.

In this webinar Terry Ryder chatted with Scott Northcott of Property Hotspot about their new venture - helping investors buy the best new properties in hot locations around Australia

At long last, we are seeing restrictions eased in Melbourne.

A further easing was announced for 27 October and then more on 8 November.

What we have observed to date suggests that Melbourne real estate markets will emerge strongly from the second lockdown and get back to business, where possible, with some enthusiasm.

The data suggests that, to date, Melbourne markets have shown considerable resilience throughout the tough times of 2020.

A collapse in property values was predicted by some economists and nothing like that has happened.

So, as Melbourne gets back to some kind of normal, where to for the city’s property markets?

To provide some answers to that general question, there’s no one better qualified than award-winning buyers agent and best-selling author Miriam Sandkuhler from Property Mavens.

Terry Ryder joins Elizabeth Jackson from Joy FM to talk about the big disconnect between the mainstream media “doom and gloom” narrative about real estate and what’s really happening for the 2/3rds of the population, who live outside the major capital cities. According to Terry, outside the big cities, where there are strong markets and low vacancy rates, its just about the best time ever for new home buyers or renters. They take a data trip around the capital cities to see where the recovery is happening fastest (spoiler alert it's Hobart and Perth) and try to gauge when Sydney and Melbourne (and the MSM) will catch up.

How To Make Your Property A Standout For Tenants

The investor survey conducted recently by hotspotting.com.au found that the No.1 factor for investors was attracting better tenants and achieving better rentals.

But how do you achieve that in a competitive market?

Expert Mark Shorrock of Bluestone Property Management says making basic improvements to your property can make all the difference.

He says: “If you take steps to better present your property, it definitely makes a difference. It makes it more tenantable, it reduces vacancy periods, it helps to get a better tenant and it helps to achieve a higher rent - and the tenant is more likely to stay for a longer period if it's a well-maintained property."

Hotspotting founder Terry Ryder will host a special webinar event on Wednesday 21 October to discuss how investors can achieve an edge in the rental market.

He will be joined by Mark Shorrock of Bluestone Property Management, who will provide a series of tips on how investors can make their property stand out from the crowd.

The strongest trend to impact Australian real estate in the 21st Century is currently sweeping the nation. The Exodus to Affordable Lifestyle is creating growth in regional cities and towns which is putting Sydney and Melbourne in the shade.