What’s the one factor that will turn the property market around?
This morning, Ironfish CEO & Founder Joseph Chou joined several key industry titans in a panel discussion at the Credit Suisse annual residential property market conference.
Attended by over 80 Credit Suisse investors, including fund managers in equities, the panel of experts shared their views on the current property market, lending and new trends.
Panellists came from a range of sectors within the property industry representing companies such as ANZ, Mortgage Choice, Probuild, Multiplex, Mirvac, GreyStar, Boral and Crown Group, at CEO, Director or General Manager levels, providing unique expertise and insights from ‘the coalface’.
Joseph Chou sat on a panel with Crown Group Chairman Iwan Sunito and Metro Property Managing Director, Luke Hartman. Mr Chou shared some of Ironfish’s unique services and processes that have ensured our continuing growth and success, despite a slowdown in the Sydney and Melbourne markets.
“For us, the key is that we partner with our investors for the long term; helping them not only to build a portfolio, but also to hold that portfolio for 10, 15 or 20 years to achieve their investment goals and retire on this income along with their super,” said Mr Chou.
“Our national reach means we can also help our investors to take advantage of other market cycles, and now more than ever, properties we recommend must have owner-occupier appeal, and not ‘investor stock’.
“Crucially, we put a lot of customer services, education and processes in very early on to help guide our investors and really hold their hand through to successful settlement.”
Mr Chou also noted that the partnership and trust developed with our customers helps keep our investors focussed on their long-term goals, without being swayed too much by sensational media headlines.
Mr Hartman agreed, saying, “I’m doing the opposite of what the Fin Review is telling me to do. Right now, I’m actively looking for sites [to purchase]. With Chinese companies exiting the market and greatly reduced supply, it’s opening up new opportunities.”
He also added that generalisations about market downturns are not helpful for investors. “You might hear someone say the US property market is down but try buy an apartment in New York… There are so many sub-markets – and of course, each development is different as well.”
Mr Sunito also noted long-term thinking as a similarity with Crown customers, stating: “our buyers are pre-conditioned to think of property as a long-term investment and they are looking to invest ahead of the game, for a longer time in the market. For us the key is location – Sydney is a global city, the factors that make a property valuable: quality, proximity to CBD, views, light – these will always be in demand.”
The million-dollar question
The final question asked by the panel moderator, Kateryna Argyrou, Credit Suisse Head of REITs, was perhaps the ‘million-dollar question’ for the audience.
“In your opinion, what’s the one factor that will turn the property market around?” Ms Argyrou asked.
Each of the three panellists offered a unique opinion.
Joseph Chou, Ironfish CEO & Founder:
“I think availability of lending will be the crucial factor. We have a strange situation where on the one hand we have banks willing to fund construction of new [residential] developments, but not funding property buyers.”
Luke Hartman, Metro Property Managing Director:
“I think government incentives will change the market. I lived in Melbourne at a time when there were significant first home buyer incentives introduced which changed the market; NRAS was another scheme that impacted the market. I think this will be more important than something like interest rates.”
Iwan Sunito, Crown Group Chairman and Group CEO:
“Personally, I think it’s already happening right now; with interest rates, government infrastructure spending, low supply. It’s already happening – there’s nothing else needed to do.”