Best place for long term growth

For me its far more important to work on the next 2 years than 20 years and work out how you can continue to making profits

Its easy to buy property anyone can do this, but the key is to make money from property each year, there is a massive difference.

 

I think what you are suggesting would be the most reasonable thing to do. Otherwise we wouldn't be able to grow our portfolios by drawing equity, even though in the long term we would still make profit.

I'd be curious to hear what would be your selection from the above list over the next 2 year period.

 

I understand your point...
However, the vast majority of property buyers buy with a long term view, especially with a view for organic growth over the long haul. Not saying this is right nor wrong...just that the majority buy based on assumptions that include those that maximise long term organic cagr...as opposed to short term inorganic cg.

 

yes I know, it takes a lot more work being an active investor, but if you can do this then you don't need a day job.

 

...depends...if the person is really active- it may well become their day job.

 

Why would anyone give up their day job for another day job, would not make any sense.

The idea is you must enjoy what you are doing otherwise no point to it, like a hobby, ie painting etc. and you get to work your own hours, and you are accountable to no one. How much money you make will be dependent on luck and skill I think.

But we are all different and I am not saying everyone should do this

 

I came across the most recent government study on the projections of the population growth. Please see the summary in the table. According to this analysis, Perth is predicted to grow by 77%, Brisbane by 49%, Melbourne by 43% and Sydney by 35%. I thought this might play a factor as to what capital city's housing prices would grow fastest.

The paper also evaluates accuracy of the previous population growth predictions made in 1981, 1991 and 2001. They conclude that they were fairly accurate apart from a few cases were the projections underestimated the growth due to the periods of strong economic growth that couldn't be anticipated (such as WA mining boom).

The projections are based on the assumptions of fertility rates, life expectancy and net overseas migration. These assumptions are shown in the second table.

 

I would suggest that the 5 years since 2011 have shown that the assumptions are flawed. Melbourne population growth has been massive over the past few years while Perth is growing by natural increase but currently has negative net interstate migration.

 

not sure..5 years isnt much time for property (unless in the speculation or flipping game or manufacturing equity + pimping it off asap right after manufacturing the equity)...Nothing wrong with those, but thats what this thread is not asking...im talking about 20 years , so if there was a long term divergence or long term transition in the trend, yes, the assumptions may need to be revisited...i wouldnt change assumptions based on 5 yrs data.

 

I was purely talking about population growth, the abs projections from 2011.

In terms of which city will provide the best long term growth over 20 years the result would be dependent on whether one squeezed another growth cycle in or missed out by a year or 2. Alter the time frame, alter the result.

Any of the 5 capitals would be a good bet would be my answer.

 

Surely it has to be sydney - this is where all the foreign investors are that are pushing up the property prices... eg the lady that runs this just sold her place there for a killing.... Backhouse Investments

 

Speaking to most of my friends, the vast majority (who are residents in Australia) buy property because it feels like it's the thing they must do, who say they are desperate to do because they will be priced out (FOMO), and generally think house prices will just keep going up. Ask them why they think this way and it's hard to get a well-thought out response.

 

The fomo will probably extend into second tiers of Brisbane maybe Perth in several years, as Sydney and Mel becomes the domain of millionaires or BRICS salaried employees (not that they have high salaries.. More like it's easy to have multiple revenue streams, often tax free...if you know what I mean)...
That does not mean Sydney and Mel won't see highest cg per annum...may..may not...but I think that increases risk of those places for sharper rises or corrections. Low risk and stability will depend on jobs. Looks good currently.. Will it be just as rosy in the future..don't know.

 

So there seems to be no panic about Sydney here unlike in some other threads on PC..

 

“In 10 years time, I’d rather have the debt than the regret,”

$2.6m: ‘I’d rather have debt than regret’

 

So you think they would all appreciate at the same proportions?

 

I don't think we have a new paradigm, the capital city markets will do what have have always done. Perceptions change due to entry point.

 

Whilst not in the 20 year long term, Wangaratta is actually due for a solid growth in the next few years. Wangaratta has good fundamentals and has experienced decent growth in the past. Wangaratta has been ranked by CoreLogic in 2018 highly as one of the few best country change locations for its high population growth of 1% in 2018 (2nd highest in north-eastern VIC), low unemployment and attractive and affordable property price.

In 2018 the town has seen its strongest house price growth in the past 10 years. The 4 bedroom median house price has risen by almost $70,000 in the past 12 months alone. The last time this type of growth occurred was in the 2014-2015 financial year. The median house price grew by 27% from $260,000 in June 2014 to $330,000 in June 2015 (this was one of the states highest growth rates).

The area was also popular in late 2017 as Wangaratta properties had a gross rental yield of 7.6% being the 2nd highest in Victoria. Crime is also low with a 6% decline in the past 12 months alone.

The local economy is also being boosted by a variety of new developments which are set to increase the appeal of the area in the future. The whole area also has NBN access.

The hospital has received $22m worth of development and expansion. Wangaratta District Specialist School and the adjacent Appin Park Primary School are also undergoing a combined $2.2m expansion. Wangaratta High School is also getting a $5m basketball stadium. The racetrack has recently undergone a $7 million development with a new grandstand, function area and accomodation.

Other developments include Wangaratta getting a $4.4m Indoor Sports and Aquatic Centre. A $12m modern Quest Wangaratta apartment block is being built with a $18 million Dan Murphy's and IGA supermarket. A 2nd $10 million Greta Road Woolworths is also in planning. The KIA car dealership is also getting a $1m development in 2019. St Catherine's Hostel is also undergoing a $14m development. A solar panel farm is also in planning nearby the town.