Current Property Report: Why the next few months are critical for investors

We know it’s been a bumpy couple of years for property, but if you’re sitting back waiting for the market to stabilise, you could be missing out on a rare opportunity to make the uncertainty of others work in your favour.

There is a growing industry sentiment that despite headline figures this week seeing a slight increase this quarter (from 1.8% to 1.9%), the worst of inflation could be behind us, and there is a very distinct window of opportunity opening up for investors who may have been sitting on the sidelines waiting for the market to stabilise.

Australian housing market metrics suggest that the rate of growth in new build costs and rents is slowing, while falling property prices and sales volume are taking the heat out of the economy directly, which is likely to support further reduction in inflation.

The national Home Value Index by CoreLogic* saw home values reach their peak in May 2022, but then decreased by -5.3% throughout the year, to -8.40% on 7 January 2023. Certainly not the predicted -20-30% property market collapse that many news outlets and commentators predicted. The driving force behind these record home value decreases is the recent cycle of rate hikes.

Not all (property) markets are created equal

While there was an overall decline in the Australian property market, not all regions are experiencing the same level of impact. Each state is at a different stage of the cycle, and within each capital city, there are various submarkets that are experiencing different trends.

Some areas are seeing a decline in property values, while others are remaining static, and some are still experiencing an increase in housing values.

This goes to the core of our Signature Portfolio approach, which seek to minimise risk by spreading (diversifying) your asset base across markets and housing product types.

Given the December headline inflation results were slightly higher than anticipated, and core inflation remains well outside the RBA’s target range, it seems probable that interest rates will rise again in February and possibly March. This could lead to a decrease in housing demand and prices in the near future.

However, as inflation may be reaching its peak, interest rates may not rise as high as some predictions from last year suggested. Once interest rates reach a stable level, as consumer confidence improves, we would expect to see a gradual stabilisation in housing prices.

At Ironfish, we stand by the philosophy that time in the market is more valuable than timing the market, especially in the long term.

It’s a Buyer’s Market – but not for long

Currently we’re seeing a market where buyers have more options and more room to negotiate on price, all of which makes for a huge window of opportunity to get into the market early in 2023 BEFORE certainty creeps back in and makes it more competitive.

Our Portfolio approach to property investing has helped over 12,000 Australians navigate their way through changing markets and build a strategy that sets you on the pathway to financial freedom.

So ask yourself, when you know something is about to stabilise do you wait for it, or do you jump on the wagon before everyone else and give yourself a huge head start in your goal of reaching financial freedom?

We want to help you achieve your investment goals sooner rather than later, so everything we do is geared towards giving you the confidence to get started  – and keep going.

• We save you time by finding appropriate investment opportunities
• Our researchers aggregate data from over 50 credible sources to provide you with up-to-date research
• With long-standing relationships with Australia’s leading developers, we can offer our investors an array of pre-selected ‘off-market’ opportunities – apartments, townhouses, and house & land – in iconic developments across all the major capital cities in Australia.
• We conduct ongoing reviews of your financial goals, so they align with your investments.

The ‘ironclad’ Ironfish property checklist

As experienced investors, we know what to look for when it comes to choosing investment properties.

Here are our top 10 ‘must-haves’

• Desirable location
• Growing population
• Transport Infrastructure
• Access to employment
• Affordable rental demand
• Top developers
• Quality checked
• Architectural design
• Owner-occupier and rental appeal
• Advantageous contracts and inclusions