Buying for Growth in Australian Property

Buying for Growth in Australian Property

Welcome to December - where the pace slows down (somewhat!) and we cherish time with family and friends.

It's a good time to reflect on where we've come from during the year. Investors can also benefit from reviewing where the property market has been and look forward to the year ahead equipped with some great hindsight. Let's take a look at at some of the latest figures including:

  1. Value of Residential Real Estate in Australia
  2. Which area can we look at for long term growth in property?

As of November 2015, residential real estate held its place clearly at the top of Australia's wealth, with a value of well over $6 trillion:

Real Estate vs other Asset classes

Residential Real Estate accounts for more than half of household wealth:

Distribution of Household Wealth

Which area can we look at for long term growth based on facts like immigration, investment and more?

Queensland provides a report, showing ownership of freehold or leasehold land - and Chinese investment has gone off the charts! As per the graph below, Chinese Investment has soared 170% over a 3 year period, with the next closest being Singapore which has only gone up 32%!

China’s investment in Queensland in the 2014/15 year was actually more than Singapore, USA and Malaysia, combined!

Chinas Investment in Aus

Logically, this investment has centered around the Brisbane and Gold Coast areas:

Queensland Road, Rail & Air

The Queensland Transport and Roads Investment Program will deliver $18.1 billion in transport infrastructure across local, state and national networks over the next four years (Source: Queensland Transport and Roads Investment Program 2014-15 to 2017-18).

Brisbane Airport, situated 12km from the CBD, is fast becoming a premier aviation hub in the Asia Pacific region. Brisbane Airport operates curfew-free and offers around-the-clock capacity. In 2013, Brisbane Airport Corporation began construction of a new parallel runway as part of a $1.3 billion infrastructure investment.

Health & Education

An ageing population and advances in medical technology are increasing opportunities in the areas of health infrastructure. In 2014-15 Queensland Health will invest $1.55 billion in capital with a number of major hospital and health facilities planned for construction in 2014-15 (Queensland Government, State Budget 2014-15).

Life sciences / bio-technology

The Queensland life sciences industry employs more than  14,000 people, invests $650 million in research and development, and has an estimated combined income of $4.4 billion (Source: Queensland Government, Queensland Life Sciences, Globally Competitive, 2013). Queensland has niche strengths in agriscience, biocommodities, and tropical health.

Substantial investments are developing these strengths to help new industries and to foster innovation in traditional industries, positioning Brisbane and Queensland as an international centre of excellence for science and technology. Brisbane’s Princess Alexandra Hospital campus brings together some of Queensland’s leading institutes such as the Translational Research Institute and the Pharmacy Australia Centre of Excellence.

Excellent economic fundamentals

With an economy valued at $135 billion, Brisbane is the economic hub and driver of the Queensland economy. Brisbane’s economy is forecast to grow by more than 60 per cent to $217 billion by 2031, driving demand for transport and logistics services for national and international markets (Source: Brisbane City Council, Brisbane 2012-2031 Economic Development Plan).

Globally connected

Brisbane is the closest major Australian capital city to Asia and home to one of Australia’s fastest-growing capital city ports, the Port of Brisbane. As the global trend to shorten supply chains continues, Brisbane is a gateway to national and international markets. Direct air and shipping links to key Asian ports means major Asian destinations can be reached by air in seven to nine hours. Brisbane has domestic trade routes south and north via the Pacific and Cunningham Highways, along with standard gauge freight rail from the Port of Brisbane to all capital cities in Australia.

Where to for Australian property 2016 & beyond?

While there is still a substantial gap between housing demand and supply (nationally), we have a good, solid foundation for continued growth of our property portfolios!

Property Club has great options for members in South East Queensland - especially on the Gold Coast, providing great opportunities for Club members!

How much tax will you pay this financial year??

Join thousands of other Property Club members who are getting the benefits of successfully investing in residential property with the experts, now assisting members for over 20 years!

You can read more about what other Club members have been achieving on our website.  Contact your Property Mentor if you're already a member, or join our great Club now.

Regards,

Troy Gunasekera

National Manager - Property Club

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