Sustainable growth

Discussion in 'What to buy' started by JDP1, 17th Apr, 2017.

Join Australia's most dynamic and respected property investment community
?

What is the main factor you look at for sustainable growth?

  1. Past performance

    0 vote(s)
    0.0%
  2. Location

    17 vote(s)
    58.6%
  3. Size

    0 vote(s)
    0.0%
  4. Demand to supply ratio

    6 vote(s)
    20.7%
  5. Quality

    0 vote(s)
    0.0%
  6. Poaition in market cycle

    5 vote(s)
    17.2%
  7. Resale market (investors, OO, students, retirees etc)

    1 vote(s)
    3.4%
  1. JDP1

    JDP1 Well-Known Member

    Joined:
    19th Jun, 2015
    Posts:
    4,244
    Location:
    Brisbane
    What is the MAIN factor you look at for sustainable growth, of potential options listed. Most would consider all, but some factors more than the other.
     
  2. highlighter

    highlighter Well-Known Member

    Joined:
    2nd Jun, 2016
    Posts:
    930
    Location:
    Australia
    Demand to supply - especially in terms of what is on the market/what will make your asset stand out, compared to what is in fact selling. If your competition is thousands of identical assets with few sales, you might have a problem. It's a good idea to look ahead for momentum e.g. likely population growth, who will be the main buyers (is it investors? Renovators? Families competing over a very popular suburb dominated by owner-occupiers? People on lower incomes reluctantly buying because it's the only area they can afford?) These change in stability over time.

    On the list I'd say past performance should be bottom of the pile. People were once paying $17 for bananas. That doesn't mean bananas are always worth $17 a pop. Assets are only ever "worth" what you can sell them for now (or when you go to sell them), and the money they're making you.
     
    Last edited: 17th Apr, 2017
    MTR likes this.
  3. JDP1

    JDP1 Well-Known Member

    Joined:
    19th Jun, 2015
    Posts:
    4,244
    Location:
    Brisbane
    Yes Id probably agree.
    I too would look at longer term averages of demand to supply. It us also a useful guide when the cycle turns. An asset with a poor demand to supply relative to the market (eg suburb x in city market y) I can't see performing well at all when the market turns ( ie sustainability) . When the market is rising, I can imagine thesr assets with lower demand-supply relative to market will rise, as do a lot when the market rises.
     
    highlighter likes this.
  4. Loverenting

    Loverenting Well-Known Member

    Joined:
    16th Nov, 2016
    Posts:
    159
    Location:
    Sydney
    Isn't demand to supply ratio resulted from other traits such as location and quality of the property?
     
  5. JDP1

    JDP1 Well-Known Member

    Joined:
    19th Jun, 2015
    Posts:
    4,244
    Location:
    Brisbane
    I would think so..
    All those factors (quality etc) should feed into the demand side...to varying degrees.
     
  6. MTR

    MTR Well-Known Member

    Joined:
    19th Jun, 2015
    Posts:
    27,786
    Location:
    My World
    I agree. Past performance not on my list at all.

    If you look at recent boom cycles for example Sydney market, it started booming in Syds Western suburbs? why? immigration, professionals coming from India could not afford inner city locations therefore prices skyrocketed.

    Melb boom cycle started in the eastern suburbs, driven by immigration and those wanting desirable school catchment areas.

    My point is past performance is a waste of time, no guarantees that history will repeat, there are too many other factors that come into play and suburbs that can be on the nose one day can change and become star performers.

    One way of achieving future performance is buy unique? something where you can add value, development site for example. You either develop or sell on, when a market starts rising development sites are very sort after and alternatively you have the option to develop.

    Also look at areas/suburbs that are earmarked for rezoning, this will add enormous value when it is ratified.
    Just my 10c worth

    MTR:)
     
  7. JDP1

    JDP1 Well-Known Member

    Joined:
    19th Jun, 2015
    Posts:
    4,244
    Location:
    Brisbane
    That's may be.. But I'd still look at TLS shares if I were u...
     
  8. MTR

    MTR Well-Known Member

    Joined:
    19th Jun, 2015
    Posts:
    27,786
    Location:
    My World
    OK, did you post this in the wrong thread?
     
  9. JDP1

    JDP1 Well-Known Member

    Joined:
    19th Jun, 2015
    Posts:
    4,244
    Location:
    Brisbane
    No
    Nope..it is a common and widely accepted standard that pc threads go off-topic :) including my own...
     
    MTR likes this.
  10. highlighter

    highlighter Well-Known Member

    Joined:
    2nd Jun, 2016
    Posts:
    930
    Location:
    Australia
    I'm wondering today how the government abolishing 457 visas is going to affect growth in some of these regions.
     
  11. MTR

    MTR Well-Known Member

    Joined:
    19th Jun, 2015
    Posts:
    27,786
    Location:
    My World
    what do you think? Not been paying attention to this
     
  12. highlighter

    highlighter Well-Known Member

    Joined:
    2nd Jun, 2016
    Posts:
    930
    Location:
    Australia
    I'm not sure I guess it'll depend on what they replace it with, a similar visa? They seem to have tightened a lot of rules. I was pretty surprised by the move. One big thing is no more pathway to permanent residency at the end of the visa. Might cause a population growth drop?
     
    MTR likes this.