By Kate Hill, Adviseable
The past few weeks has seen a significant uptick in doom and gloom reporting.
We have monthly reports of softening property prices, scary projections of dwelling value falls, plus, never-ending conjecture on where interest rates will end up peaking.
All in all, the plethora of bad property news is really starting to bum me out!
And it’s not because market conditions are not producing moderating metrics.
Rather, it’s that all the negative reporting is making people think that property has all of a sudden become a bad idea, when that’s just not the case.
Reason for optimism
Recently, the Property Investment Professionals of Australia (PIPA) – of which I am a proud member – released some of the results of its 2022 Annual Investor Sentiment Survey.
The survey – now in its eighth year – always provides timely and relevant insights into how investors are thinking and feeling at present and into the year ahead.
The survey has form when it comes to forecasting what might happen next, with the 2020 investor snapshot predicting strong property price growth in the year ahead – not that anyone believed the results… at the time.
Of course, this year’s results that oodles of investors have offloaded their properties over the past two years– especially in Queensland – stole the headlines, and rightly so, because it is the major reason why there is such an undersupply of rental properties around the nation.
Likewise, the fact that up to 19 per cent of investors are considering selling a property in the year ahead, according to the survey.
But hiding in plain sight in the survey was a metric which anyone considering purchasing a property should understand.
That’s because, according to the survey, nearly 60 per cent of investors believe that now is a good time to invest in residential property – even with all the supposedly woeful datasets that are continually being released at present.
What I find most interesting about this sentiment – apart from the fact that I agree with it wholeheartedly – is that it is only slightly below the result in 2020 when 67 per cent of investors were optimistic about the year ahead… and of course they were right.
Last year’s survey found that 62 per cent thought it was a good time to invest and it was – depending on where and what you bought and, obviously, how much you paid in peak market conditions. If you stuffed up any of those this time last year, well, it probably wasn’t a very good time to buy at all.
However, the fact that about 58 per cent of investors think the year ahead is looking positive is a reflection of the fact that moderating market conditions provide opportunities and not threats.
Let’s consider that compared to this time last year, we have lower buyer activity, more listings, reducing property prices, as well as growing rental yields then what’s not to love for anyone seeking a long-term, low-risk investment?
It’s for these very reasons that I ask you all to turn that property frown upside down and get out there amongst it while everyone else is waiting for the sky to fall.
