The Four W's
  • 19 November 2016

The Four W's

I would like to introduce a good mate of mine Michael Matusik. He has been a well-respected commentator on property for over 20 years with regular articles in national publications.

I am sure you will benefit from his insights.

Kevin Young

Matusik Missive

Two minute read.

If only I had a dollar for every time someone, over the past week, emailed me asking what the Trump win would mean to the Aussie residential property market.

Here was my standard email reply:

No idea yet and anyone that says they do is, well, winging it.

It is too soon to really know.

Yet, none of the important things have changed – being what you are buying; who is going to rent it from you and/or buy it off you in the future; where it is and when you buy. These fundamentals still apply.

And maybe more so than in the past.

If anything, the Trump win, like Brexit plus other recent events both at home and abroad, indicates that we live in an increasingly uncertain world.

Property investors will need to be more selective in order to find growth. For mine, generic, across the board, growth is a thing of the past.

A rising or falling tide will not necessarily move all ships.

Let me quickly cover off those Four W's.

What

Here, four things matter most – without wanting to place catchy caps on everything – I call this the Four Ps:

  • People – who is involved and what’s their pedigree/experience?
  • Product – does it suit the current and, more importantly, future markets?
  • Position – is the property in a good spot?
  • Price – not only the price paid, but the terms of the deal too

Who

Who is going to rent the investment off you? Can you get more rent via more tenants or higher paying ones? Who will buy the property off you when it comes time to resell? Will this property hold an increasing appeal into the future? If not, can it be improved so that it does?

Where

If an investment, is the property in a future pulse point? Will the actual location retain; gain or lose value?

When

At what phase is the local property cycle – recovery, upswing, peak, downturn, stagnation or trough? Remember, the best buying opportunities are when supply exceeds demand – the downturn-to-trough stages of most property cycles.

We are not financial advisors. I am the last person you should ask for investment advice.

But an election result – regardless of who wins – should make little difference to your property decision making process.

You are either in the market or not.

So if you are in the market, our recent buying guides – go here and here to revisit – may be of some help.

Michael Matusik

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