WEBVTT - Why Queensland units are the future 0:00:07.800 --> 0:00:11.680 Hello, Welcome to the Australians Money Puzzle podcast. I'm James Kirkby. 0:00:11.960 --> 0:00:15.040 Welcome aboard everybody. What a difference a week makes. We 0:00:15.120 --> 0:00:18.520 finally get a raid cut and suddenly there are stories 0:00:18.680 --> 0:00:23.720 ever heard really about improved signals across the property market. 0:00:24.120 --> 0:00:27.840 I've been wondering where exactly these improved signals are, Like, 0:00:28.080 --> 0:00:34.760 where are the hotspots in this national property market post 0:00:34.920 --> 0:00:39.000 rad cut? Where we are it would seem heading into 0:00:39.000 --> 0:00:41.840 a raid cycle. Well who better to tell us about 0:00:41.880 --> 0:00:44.320 where the hotspots are than Terry Rider, regular guest on 0:00:44.400 --> 0:00:47.680 the show, and who runs the hot spotting service? How 0:00:47.680 --> 0:00:48.240 are you, Terry? 0:00:49.240 --> 0:00:51.440 Are you well joined yourself? Good? 0:00:51.520 --> 0:00:54.040 Thank you, thanks for coming on the show. Do you 0:00:54.160 --> 0:00:57.360 get that sense that there's an uptick in tempo in 0:00:57.400 --> 0:01:01.800 the markets following this raid cut? First in four years? 0:01:02.200 --> 0:01:05.760 Look, I really don't think that the very small and 0:01:06.040 --> 0:01:07.840 apparently isolated rope. 0:01:07.560 --> 0:01:09.680 Cup is terribly influential. 0:01:09.760 --> 0:01:13.720 I think things were fairly upbeat already. It certainly doesn't 0:01:13.800 --> 0:01:17.600 hurt and as may have a psychological impact. It does 0:01:18.200 --> 0:01:22.320 improve borrowing capacity a little bit. But we ended twenty 0:01:22.360 --> 0:01:26.880 twenty four with markets generally pretty strong, and we started 0:01:26.920 --> 0:01:30.840 twenty twenty five very strongly as well. We often find 0:01:31.080 --> 0:01:33.440 in our business, and I think a lot of properly 0:01:33.480 --> 0:01:37.000 related businesses that January is often half a month because 0:01:37.000 --> 0:01:39.480 a lot of people are on leave and not really 0:01:39.480 --> 0:01:43.280 doing things. But this year January started right from the 0:01:43.319 --> 0:01:46.479 get go. A lot of investors obviously started the year 0:01:46.520 --> 0:01:50.360 with intent, intending to do things, and that's what was 0:01:50.400 --> 0:01:54.400 happening last month and through into February. And a rope 0:01:54.440 --> 0:01:58.920 cut is perhaps a minor contribution to something some momentum 0:01:58.920 --> 0:01:59.760 that was already building. 0:01:59.840 --> 0:02:04.560 Think okay, but Sydney and Melbourne places on the month 0:02:04.600 --> 0:02:05.560 were actually negative. 0:02:06.120 --> 0:02:06.720 Well, that's right. 0:02:06.840 --> 0:02:10.079 We never have a situation in asurround property markets where 0:02:10.080 --> 0:02:13.560 the same thing that's happening everywhere. Sometimes media talk talks 0:02:13.560 --> 0:02:15.520 about a two speed market. We tend to think of 0:02:15.560 --> 0:02:18.440 a more like a four speed market where we at 0:02:18.440 --> 0:02:20.359 any point in time in twenty twenty four was a 0:02:20.400 --> 0:02:23.880 case in point. We had some markets, some capitalist cities 0:02:23.880 --> 0:02:26.840 and some regional markets that were booming, some that had 0:02:26.880 --> 0:02:30.000 moderate growth, some that were stagnating, and a few like Melbourne, 0:02:30.000 --> 0:02:32.920 with prices actually fell in the last twelve months. And 0:02:33.320 --> 0:02:36.320 that's pretty much normal. We do believe very strongly that 0:02:36.480 --> 0:02:39.560 real estate is local, very local. We don't have an 0:02:39.600 --> 0:02:43.120 Australian property market with literally thousands of individual markets and 0:02:43.120 --> 0:02:46.320 they all arise out. What's happening with local economies and 0:02:46.520 --> 0:02:49.000 Melbourne I think we'll talk about it a little bit later, 0:02:49.120 --> 0:02:52.760 but it's a market that's struggling for its own local 0:02:52.960 --> 0:02:54.600 Victorian state reasons. 0:02:54.960 --> 0:02:56.080 That's right, Yes, it is. 0:02:56.360 --> 0:02:56.520 Well. 0:02:56.639 --> 0:02:58.720 I imagine when people meet you and they find out 0:02:58.760 --> 0:03:01.120 what you do on the nicture of the enterprise hot spotting, 0:03:01.560 --> 0:03:04.680 the obvious question for you, Terry is what are the 0:03:04.720 --> 0:03:10.000 hotspots from a geographic perspective around Australia to the morment, 0:03:10.600 --> 0:03:12.400 where are the hot spots? 0:03:13.400 --> 0:03:17.040 Well, taking a broad brush view, we have done a 0:03:17.080 --> 0:03:19.960 major analysis to give us some indicators of where we 0:03:20.040 --> 0:03:24.160 expect the growth to be in twenty twenty five and beyond, 0:03:24.240 --> 0:03:26.240 because we always take a long term view, as you 0:03:26.240 --> 0:03:30.200 should with real estate, but all the metrics tell us 0:03:30.240 --> 0:03:33.040 that is going to be very much the year of Queensland. 0:03:33.280 --> 0:03:37.480 Queensland not only investor but also home buyers because Queensland 0:03:37.960 --> 0:03:41.320 gets more uplift from internal migrants than any other state 0:03:41.400 --> 0:03:44.000 or territory in the country, and that continues. So we 0:03:44.080 --> 0:03:47.080 have a strong demand from people moving to Queensland as 0:03:47.120 --> 0:03:49.800 home buyers, but we also have investors. There seems to 0:03:49.800 --> 0:03:54.040 be a pivoting away from Perth and worstern Australia towards Queensland. 0:03:54.440 --> 0:03:59.480 Regional Queensland is very strong. We ended twenty twenty four 0:03:59.600 --> 0:04:03.560 with some of those Queensland regional cities as hot and 0:04:03.640 --> 0:04:06.400 his frenzied and as competitive as the Perth market has 0:04:06.440 --> 0:04:09.320 been in the last year or so. So if you're 0:04:09.320 --> 0:04:13.080 trying to buy a regional city like Rockhampton or Townsville, 0:04:13.320 --> 0:04:16.719 you'd find yourself competing for the same property with fifteen 0:04:16.800 --> 0:04:19.680 or twenty others and it would sell very quickly and 0:04:19.720 --> 0:04:23.840 probably for more than the asking price. So we're going 0:04:23.880 --> 0:04:26.360 to see more of that this year right throughout regional 0:04:26.480 --> 0:04:29.320 Queensland because it has probably more than any other state 0:04:29.400 --> 0:04:30.000 or territory. 0:04:30.000 --> 0:04:30.920 It has a. 0:04:30.920 --> 0:04:34.680 Large number of regional centers that are affordable, they have 0:04:34.760 --> 0:04:36.039 high rental yields and they've. 0:04:35.839 --> 0:04:37.760 Got great prospects for growth. There's a big. 0:04:37.640 --> 0:04:41.359 Infrastructure spend happening in many of those cities, and Queensland 0:04:41.400 --> 0:04:45.839 offers that more than any other place in Australia. Adelaide 0:04:45.880 --> 0:04:49.359 in South Australia continue to be strong. Adelaide's remarkably consistent. 0:04:49.480 --> 0:04:53.440 It's been rising for four or five years and it's 0:04:53.480 --> 0:04:57.080 not showing any signs of slowing down, whereas the Perth 0:04:57.400 --> 0:05:01.719 and Western Australian markets definitely are weren't seeing no signs 0:05:01.800 --> 0:05:05.839 yet that Adelaide has slowed down. There's still a significant 0:05:05.880 --> 0:05:09.560 shortage of listenings and Adelaide's still a significant shortage of rent. 0:05:11.000 --> 0:05:13.600 Rental vacancy is an incredibly low in Adelaide, as they 0:05:13.600 --> 0:05:17.000 have been for the past several years. Probably the big 0:05:17.040 --> 0:05:20.400 surprise that I think we'll see in twenty twenty five 0:05:20.680 --> 0:05:23.039 is Darwin. I think Darwin's going to do much better. 0:05:23.040 --> 0:05:25.320 It's been a poor performer in the last couple of years. 0:05:25.839 --> 0:05:28.680 More and more investors asking questions about Darlin because it 0:05:28.680 --> 0:05:31.039 has by far the highest rental yields in the country 0:05:31.240 --> 0:05:35.599 amongst the capital cities. It's very affordable, and it also 0:05:35.800 --> 0:05:41.240 has some major investment developments, infrastructure projects and the works, 0:05:41.279 --> 0:05:44.880 some very big resources related things happening in the Northern Territory. 0:05:45.279 --> 0:05:47.520 If one or two of those come off, it's really 0:05:47.520 --> 0:05:49.600 going to supercharge the Darwin market. 0:05:50.320 --> 0:05:52.320 The ones that expect to be weak. 0:05:52.360 --> 0:05:54.680 Camera continues to be one of the weakest markets in 0:05:54.720 --> 0:05:58.280 the country, and Perth and Wa after two or three 0:05:58.360 --> 0:06:00.960 years of leading the nation on price growth, there's a 0:06:00.960 --> 0:06:05.040 lot of indicators now that those markets moderating and the 0:06:05.080 --> 0:06:07.800 peak has been passed in those markets unrapidly. 0:06:08.720 --> 0:06:11.280 It's told it there and we'll do with Sydney and 0:06:11.320 --> 0:06:13.600 Murdurn in the Mormons. Two things cut cut my eye 0:06:13.600 --> 0:06:19.039 there on on Perth topping ours, you were seeing, there's 0:06:19.040 --> 0:06:22.480 a number of indicators would suggest that this extremely good 0:06:22.520 --> 0:06:26.000 spell they've had in Perth where it was the strongest 0:06:26.279 --> 0:06:30.560 city in Donetian, what do you see that tells you 0:06:30.640 --> 0:06:31.760 it might be slowing down? 0:06:31.760 --> 0:06:31.960 Now? 0:06:33.279 --> 0:06:35.920 There are a number of indicators. Firstly sales volumes, which 0:06:35.960 --> 0:06:39.560 is something that we monitor quarter by quarter, and it's 0:06:39.600 --> 0:06:42.400 about the middle of twenty twenty four we started to 0:06:42.400 --> 0:06:45.520 see those taper off because prior to that, for the 0:06:45.560 --> 0:06:49.160 previous a two years, pretty much every suburban Perth if 0:06:49.200 --> 0:06:52.760 you looked at the quarterly the pattern of quarterly sales activity, 0:06:52.760 --> 0:06:56.039 it was just rising and rising, and then it started 0:06:56.040 --> 0:06:58.839 to taper off in the second half of calendar twenty 0:06:58.880 --> 0:07:03.119 twenty four, so it's indicator, but more particularly perhaps we've 0:07:03.160 --> 0:07:06.440 also seen the rate of price growth dropping month by month. 0:07:07.080 --> 0:07:10.760 The latest figures from Project for example, the annual rate 0:07:10.800 --> 0:07:13.200 for Perth has dropped to about twelve or thirteen percent, 0:07:13.240 --> 0:07:16.360 whereas just you know, four or six months ago it 0:07:16.400 --> 0:07:18.800 was not twenty five percent. And we've noticed that every 0:07:18.880 --> 0:07:21.840 month the rate of growth has dropped. Perhaps the most 0:07:21.960 --> 0:07:25.280 connect significant thing with the price data was with core 0:07:25.360 --> 0:07:28.080 Logic where they show the figures for the latest month 0:07:28.480 --> 0:07:31.360 and the latest quarter, and Perth has been overtaken. Has 0:07:31.440 --> 0:07:35.400 previously been leading the nation by quite a considerable margin 0:07:35.680 --> 0:07:39.760 on those metrics, but in the latest figures for January, 0:07:40.080 --> 0:07:43.600 in the latest months several cities have overtaken Perth on 0:07:44.160 --> 0:07:46.640 leading for the monthly price grape but also for the 0:07:46.720 --> 0:07:47.480 latest quarter. 0:07:47.880 --> 0:07:48.560 So we saw. 0:07:48.440 --> 0:07:51.200 Cities like Brisbane, Adelaide and Darwin and some of the 0:07:51.240 --> 0:07:54.320 regional markets actually having high growth in the latest month 0:07:54.360 --> 0:07:55.640 and the last latest quarter. 0:07:55.960 --> 0:07:58.800 I see, okay right with that. Yeah, so that would 0:07:58.840 --> 0:08:01.040 suggest it has been on the show a few times. 0:08:01.120 --> 0:08:04.320 Interesting to hear you actually drill down and chill us 0:08:04.400 --> 0:08:08.239 why that is the case that the Perth market stopping 0:08:08.240 --> 0:08:10.840 from a great height. It has to be said by that, 0:08:10.880 --> 0:08:14.280 I mean that the price growth was extraordinary for a 0:08:14.360 --> 0:08:17.600 year or two, but now slowing down. And then on 0:08:17.600 --> 0:08:19.720 the other hand, Terry, you were saying that you were 0:08:19.720 --> 0:08:22.960 saying that Queensland actually gets a great left from immigration. 0:08:23.040 --> 0:08:25.880 It's interesting. I would have thought it was Melbourne being 0:08:25.960 --> 0:08:29.920 sort of jobs city that had that, but you find 0:08:29.960 --> 0:08:33.920 that the immigration is a pump if you like, behind 0:08:33.920 --> 0:08:36.040 the Queensland market. Yeah. 0:08:36.280 --> 0:08:38.040 Well I was talking when I referred to queens I 0:08:38.080 --> 0:08:41.000 was talking about internal migration, which is people moving from 0:08:41.440 --> 0:08:43.200 part of the Australia to another. 0:08:43.559 --> 0:08:44.240 And we've had this. 0:08:44.280 --> 0:08:46.400 Trend for some time awfter a well in course of 0:08:46.440 --> 0:08:49.240 Sydney for ten years, where people are moving from the 0:08:49.240 --> 0:08:53.079 two biggest cities to regional areas of smaller cities. We 0:08:53.200 --> 0:08:57.120 call it the exodus to affordable lifestyle. And it was 0:08:57.160 --> 0:08:59.400 believed by some that it was kind of came out 0:08:59.440 --> 0:09:01.680 of the cop lockdowns, but really it was underway for 0:09:01.760 --> 0:09:04.880 much longer, and it hasn't slowed down now that all 0:09:04.920 --> 0:09:08.200 the sort of the lockdown and restrictions of COVID have passed, 0:09:08.640 --> 0:09:11.160 as some expect that it would. Now there was a 0:09:11.160 --> 0:09:14.080 prediction that people would move back, but that's not happening, 0:09:14.240 --> 0:09:17.720 nor would I expect it to so Queensland. Whereas Melbourne 0:09:17.720 --> 0:09:22.280 gets the most from overseas migration, Queensland, Brisbane and Queensland 0:09:22.320 --> 0:09:25.320 get the most from internal migration and really big numbers. 0:09:25.800 --> 0:09:28.720 You know, it's about climate and or perception of climate 0:09:28.800 --> 0:09:32.319 because it hasn't been so great up here in Queensland, 0:09:34.640 --> 0:09:39.480 but lifestyle climate affordability too. As I said earlier, there's 0:09:39.559 --> 0:09:41.800 so many regional parts of Queensland that are just so 0:09:41.880 --> 0:09:45.480 affordable relative to the lifestyle that they offer, both along 0:09:45.480 --> 0:09:47.840 the coast and some of the wonderful inland cities like 0:09:47.880 --> 0:09:51.960 twimber Is a wonderful place, was great lifestyle aspects, very 0:09:51.960 --> 0:09:54.520 strong economy and it's one of one of the strongest 0:09:54.559 --> 0:09:55.800 regional markets in the nation. 0:09:56.400 --> 0:10:00.680 So these regional spots hot spots in Queensland. You mentioned 0:10:00.720 --> 0:10:06.280 some towns Rockhampton, Townsville to Woomba, so it seems to 0:10:06.280 --> 0:10:10.439 me that they have a lot of what investors want 0:10:10.880 --> 0:10:13.960 in that it's not just that the yields are better 0:10:14.160 --> 0:10:18.440 than inner Sydney or inner Melbourne, but they have the 0:10:18.480 --> 0:10:21.000 price growth for atension as well, so you're getting the 0:10:21.000 --> 0:10:23.920 two sides that you would always want as an investor. Yes, 0:10:24.360 --> 0:10:26.600 very interesting and I wonder how they match up against 0:10:26.600 --> 0:10:28.679 the big cities. We'll take a break, folks and we'll 0:10:28.720 --> 0:10:40.400 have a look at Melbourne and Sydney in a minute. Hello, 0:10:40.480 --> 0:10:44.000 Welcome back to The Australian's Money Puzzle podcast. James Kerby 0:10:44.000 --> 0:10:48.679 here with Terry Ryder of the Hot Spoting Group. So 0:10:48.720 --> 0:10:52.280 Sydney and Melbourne, then, Terry, Melbourne obviously the weakest market 0:10:52.320 --> 0:10:56.239 in the country, the weakest figures on just about every criteria. 0:10:57.120 --> 0:11:01.959 Falling prices in the last month the two and Sydney 0:11:02.000 --> 0:11:04.360 also had a soft on in January. As you said, 0:11:04.360 --> 0:11:06.880 that's it's not a regular a month, but they would 0:11:06.920 --> 0:11:09.720 have very low yields and would those years would stay. 0:11:09.920 --> 0:11:11.640 I mean roughly, what would there be like half of 0:11:11.720 --> 0:11:14.520 regional towns something like two and a half percent against 0:11:14.559 --> 0:11:15.560 five something like that. 0:11:16.600 --> 0:11:20.199 Well, yeah, perhaps an even greater differential. There's there's plenty 0:11:20.200 --> 0:11:23.439 of places in regional markets across trade we can get 0:11:23.760 --> 0:11:26.360 six seven percent rental yields. And we should never forget 0:11:26.360 --> 0:11:28.719 when we're talking about yields, we must never forget to 0:11:29.640 --> 0:11:34.400 include units and the discussion because increasingly investors and home 0:11:34.440 --> 0:11:38.720 buyers are opting for attached dwellings as a purchase of choice, 0:11:38.720 --> 0:11:40.000 and of course the units tend to. 0:11:40.000 --> 0:11:41.080 Have higher rental yields. 0:11:41.080 --> 0:11:44.120 But yeah, I mean, you can't very readily find well 0:11:44.120 --> 0:11:48.040 above six percent rental yields on houses in regional queens 0:11:48.080 --> 0:11:49.520 somewhereas in Sydney and Melbourne. 0:11:49.520 --> 0:11:50.920 It's more like two or three percent. 0:11:51.400 --> 0:11:53.679 Yes, it is, And our listeners will tell you this 0:11:53.760 --> 0:11:57.679 is the fact. There's a correspondence coming up, folks. In 0:11:57.679 --> 0:12:01.400 one of our one of our correspondents, John actually spens 0:12:01.480 --> 0:12:05.320 out just what is when he's finished paying all the 0:12:05.320 --> 0:12:08.640 taxes and bits of Victoria, and it's really spectacular. Well, 0:12:08.679 --> 0:12:10.439 it's one point two percent a year, he says. We've 0:12:10.440 --> 0:12:12.720 come to that in the moment. So looking at Melbourne 0:12:12.720 --> 0:12:15.600 and Sydney, then what's the view on them? The leading 0:12:15.840 --> 0:12:18.960 research houses are seeing two or three percent growth this 0:12:19.120 --> 0:12:23.200 year from Melbourne or Sydney. That's barely keeping up with 0:12:23.280 --> 0:12:25.840 in fleetion and that's sort of like basically going nowhere, 0:12:25.880 --> 0:12:27.440 what's your view on the big cities? 0:12:27.960 --> 0:12:31.040 Look a little bit more abortion that when we when 0:12:31.120 --> 0:12:33.600 analyzed all the markets around the country, and as I said, 0:12:33.600 --> 0:12:37.520 earlier we found Brisbane and Queensland leading Adelaide in South Australia, 0:12:37.600 --> 0:12:39.560 and well Sydney and Melbourne was sort of the middle 0:12:39.600 --> 0:12:43.360 of the pack. Expected to have moderate growth this year, certainly, 0:12:43.800 --> 0:12:46.320 but perhaps a little bit better than two or three percent. 0:12:46.480 --> 0:12:48.600 The thing I think people need to keep in mind 0:12:48.720 --> 0:12:52.520 is that those figures that are published about Sydney house 0:12:52.520 --> 0:12:56.480 prices rose two percent last year, but they're very big generalizations. 0:12:56.520 --> 0:12:59.080 People again come back to the point that markets are 0:12:59.120 --> 0:13:01.760 very local and nature, and that includes within big city. 0:13:01.880 --> 0:13:06.360 So Sydney is a massive city with something like over 0:13:06.400 --> 0:13:10.000 seven hundred suburbs and it's not just one market all 0:13:10.200 --> 0:13:14.280 performing in the same way. So whereas the generalized figures 0:13:14.320 --> 0:13:17.400 would say that Melbourne house prices only rows two or 0:13:17.400 --> 0:13:21.760 three percent last year, within Greater Sydney, there were pockets 0:13:21.760 --> 0:13:26.160 that did double digit growth, particularly for example, the local 0:13:26.160 --> 0:13:28.800 governor of Canterbury Bankstown, which has become a very popular 0:13:28.840 --> 0:13:32.559 market because it's quite low, well located, got good amenities 0:13:32.640 --> 0:13:37.400 and infrastructure, but by Sydney standards, quite affordable. Particularly it's 0:13:37.440 --> 0:13:40.120 unit markets. You can sort of buy small units in 0:13:40.160 --> 0:13:43.080 many of the suburbs of Canoby Bankstown. You know, in 0:13:43.120 --> 0:13:45.200 the four hundred thousands, which is a very rare thing 0:13:45.240 --> 0:13:47.240 to be able to do anywhere in Greater Sydney. 0:13:47.480 --> 0:13:49.160 Did you say that what did you say the price 0:13:49.240 --> 0:13:52.920 growth was in the Canterbury Bankstown Well. 0:13:52.559 --> 0:13:56.319 In many of the suburbs of Canterbury Bankstown Municipality it's 0:13:56.600 --> 0:13:59.080 ten or fifty percent in the last twelve months. 0:13:58.760 --> 0:14:00.760 That right, but the city was just two or three Say, 0:14:00.840 --> 0:14:02.400 sorry to interrupt you, and you were going to tell 0:14:02.400 --> 0:14:04.080 me about the houses, you said, the units and what 0:14:04.120 --> 0:14:05.480 was the story with the houses there. 0:14:06.280 --> 0:14:08.640 Well, you're typically paying a little bit over a million 0:14:08.640 --> 0:14:11.199 dollars for houses, but again, you know, the medium price 0:14:11.240 --> 0:14:13.240 for Sydney, depending on who you figures, you believes one 0:14:13.280 --> 0:14:16.280 point two one point three million as a median house price, 0:14:16.320 --> 0:14:19.120 and Canery Banks Down houses tend to be lower than that. 0:14:19.280 --> 0:14:23.160 So it has that appeal of affordability, but also you know, 0:14:23.280 --> 0:14:26.800 pretty good location, bustling market. It's one that we've been 0:14:26.840 --> 0:14:28.920 recommending for the last couple of years and it certainly 0:14:29.000 --> 0:14:32.960 performed well above the average for Greater Sydney. So I 0:14:33.000 --> 0:14:35.800 think the trick for investors and buyers have all sorts 0:14:35.840 --> 0:14:38.320 really is to find those outlies and they do exist 0:14:38.400 --> 0:14:41.400 within Sydney. They also exists within Melbourne because there are 0:14:41.400 --> 0:14:45.000 some parts of Melbourne where her prices have actually grown 0:14:45.080 --> 0:14:47.920 in the last twelve months, contrary to that generalized figure 0:14:48.000 --> 0:14:51.000 it says overall Melbourne was down a few percent. 0:14:51.080 --> 0:14:54.200 In Melbourne, then there's no direct equivalent. 0:14:54.360 --> 0:14:57.560 We'll find that the more affordable outering areas that are 0:14:57.760 --> 0:15:00.000 once where it's most likely to have been price grape, 0:15:00.040 --> 0:15:03.840 but also in the inner city markets, it's the unit markets. 0:15:03.840 --> 0:15:07.360 And this I think we've talked about this before, James, 0:15:07.400 --> 0:15:09.880 this big trend where more and more people are opting 0:15:09.960 --> 0:15:14.600 for attached dwellings, not just for affordability reasons, but for lifestyle, 0:15:14.720 --> 0:15:18.080 for location, for security and safety, because a lot of 0:15:18.080 --> 0:15:21.280 people are concerned about crime on the streets now Melbourne. 0:15:21.320 --> 0:15:23.960 I know a lot of people in Melbourne. I'm constantly 0:15:23.960 --> 0:15:28.200 hearing stories about breakings, who attempted breakings, and people feel 0:15:28.400 --> 0:15:30.920 some people anyway want to be in an apartment on 0:15:30.960 --> 0:15:32.520 the tenth floor and a building. 0:15:32.240 --> 0:15:33.520 That's got security features. 0:15:33.600 --> 0:15:36.760 So there's lots of reasons why people are opting for 0:15:36.920 --> 0:15:40.040 units these days, and we're now seeing ten around that 0:15:40.120 --> 0:15:43.040 dominant paradigm that used to be which said that houses 0:15:43.080 --> 0:15:45.800 on their noise show better capital growth than units, but 0:15:45.800 --> 0:15:49.080 we're seeing that completely challenged now right across Australia in 0:15:49.120 --> 0:15:52.680 different markets where I think figures from I think core 0:15:52.800 --> 0:15:57.160 Logic recently said that across Australia, sixty percent of suburbs 0:15:57.160 --> 0:15:59.600 have higher growth for units than they did for houses 0:15:59.640 --> 0:16:02.160 last year, and in Brisbane it was eighty seven percent 0:16:02.400 --> 0:16:05.200 of suburbs units outperformed houses. 0:16:05.280 --> 0:16:07.200 Do you think there's an element of catch up there 0:16:07.240 --> 0:16:09.400 because the units were way behind. 0:16:09.640 --> 0:16:11.920 There is an element of catch up, but I think, James, 0:16:11.920 --> 0:16:14.680 it's mostly that we're just seeing this real uplift and demand. 0:16:14.680 --> 0:16:18.400 We've been watching the market share of units in the 0:16:18.440 --> 0:16:21.480 major cities and it's rising quarter by quarter and Sydney 0:16:21.600 --> 0:16:24.160 is now fifty five percent of all sales across Greater 0:16:24.200 --> 0:16:27.960 Sydney attached dwellings rather than houses on land, and so 0:16:28.040 --> 0:16:31.200 that's having a big impact on the price data. And 0:16:31.480 --> 0:16:34.320 just getting back to Melbourne, some of those inner city Melbourne, 0:16:34.560 --> 0:16:37.280 including the Melbourne CB itself which has a lot of apartments, 0:16:37.640 --> 0:16:40.480 there was price growth in some of those locations with 0:16:40.640 --> 0:16:43.480 units in the last twelve months, contrary to the overall 0:16:43.560 --> 0:16:44.520 trend for Melbourne. 0:16:45.040 --> 0:16:49.680 Is that interesting? Yeah, very interesting because when we look 0:16:49.720 --> 0:16:52.280 at units, often you will see that they have been 0:16:52.320 --> 0:16:54.600 sold for something like the price that there were four 0:16:54.680 --> 0:16:57.320 or five years ago. I'm talking about it at Melbourne 0:16:57.360 --> 0:17:00.120 for instance, But then that doesn't tell me that they 0:17:00.160 --> 0:17:02.680 look more closely, maybe the case that the last twelve 0:17:02.720 --> 0:17:05.480 months was where the action was and actually that it 0:17:05.560 --> 0:17:07.960 has recovered in the last felve months. And when you 0:17:08.040 --> 0:17:10.399 say units cherry, you basically mean anything other than a 0:17:10.440 --> 0:17:12.880 stand alone house. But the sounds of it, it covers 0:17:12.920 --> 0:17:15.560 both apartments and the townhouses. 0:17:15.760 --> 0:17:19.560 Anything attached townhouses, units, apartments, whatever you like to call them, 0:17:20.760 --> 0:17:23.840 things that they're on some sort of strata plan. And 0:17:23.960 --> 0:17:27.119 it's I think it's probably the most significant trend in 0:17:27.119 --> 0:17:30.520 Australia safe for the last ten years. We're quite interested 0:17:30.520 --> 0:17:32.560 in it and we're tracking it and we're starting to 0:17:32.760 --> 0:17:36.600 you know, we're producing new and different reports now because 0:17:36.840 --> 0:17:39.280 this has become a big factor in the market. You know, 0:17:39.880 --> 0:17:44.199 more affordable, lots of features that apartments can offer that 0:17:44.400 --> 0:17:48.320 houses can't. Typically a house doesn't have a view, not 0:17:48.359 --> 0:17:51.600 always of course, whereas much units do. Is that safety 0:17:51.600 --> 0:17:54.840 and security feature that's that low maintenance, lock up and 0:17:55.400 --> 0:18:00.560 leave facility that is better with units. And it's also location. 0:18:00.880 --> 0:18:03.919 Quite often units are much better located. There was actually 0:18:04.160 --> 0:18:07.240 an interesting study by Infrastructure. 0:18:06.640 --> 0:18:08.720 Victoria a year or two ago. 0:18:08.600 --> 0:18:12.680 Which found that the average apartment was much better located 0:18:12.720 --> 0:18:16.399 relative to where schools and shops and public transport was 0:18:16.480 --> 0:18:19.199 than the average house and that has an impact on 0:18:19.320 --> 0:18:21.720 price grast, so that all those factors are feeding into 0:18:21.800 --> 0:18:25.320 this trend and it's become Yeah, we think the most 0:18:25.320 --> 0:18:29.520 significant big change in property markets in Australia in a decade. 0:18:29.880 --> 0:18:32.679 See that's really interesting because I suppose the challenge what 0:18:32.760 --> 0:18:36.560 a challenge is the bias probably that many investors would 0:18:36.560 --> 0:18:40.520 have in two dan I probably have from watching units 0:18:41.800 --> 0:18:48.800 perform poorly against standard doornhouses, probably for a decade at least. Yeah, right, okay, 0:18:48.800 --> 0:18:50.120 but do you think the swing is happening? 0:18:51.080 --> 0:18:51.840 Well, I think it was. 0:18:51.800 --> 0:18:54.400 Already well underway. And if you look at many locations 0:18:54.440 --> 0:18:57.320 in Australia compare the price growth not just in the 0:18:57.400 --> 0:18:59.960 last year, but in say that the last five years 0:19:00.080 --> 0:19:04.360 the four year average, we're finally increasing examples where apartments 0:19:04.400 --> 0:19:06.399 are up performing the houses in the same Like Christian 0:19:06.680 --> 0:19:09.240 as I mentioned, earlier. Therese recent figures that across the 0:19:09.280 --> 0:19:14.240 Strike sixty percent of suburbs now units are upperforming, and 0:19:14.280 --> 0:19:16.119 in Brisbane it's a much harder percentage. 0:19:16.280 --> 0:19:18.880 Very interesting, Okay, listeners, I think that we would take 0:19:19.000 --> 0:19:22.520 that on board in terms of mega trends, which we 0:19:22.560 --> 0:19:24.920 don't really see very often, and it's one of the 0:19:24.960 --> 0:19:26.720 reasons I asked Harry to come on the show was 0:19:26.760 --> 0:19:29.280 to try and eak out of your life what's really 0:19:29.320 --> 0:19:33.600 happening on momentum and trends across the country, not just 0:19:33.640 --> 0:19:37.080 in terms of this town or that town against another suburb, 0:19:37.280 --> 0:19:40.119 but very interesting that notion that in fact, the units 0:19:40.200 --> 0:19:42.960 are going through a very strong phase at the moment, 0:19:43.440 --> 0:19:45.840 and it's something that's worth keeping in mind. Just when 0:19:45.880 --> 0:19:49.159 you think you figured out the property market, it surprises you. 0:19:49.520 --> 0:19:51.359 And there was a sense always, of course that units 0:19:51.400 --> 0:19:54.159 would need to catch up with standalone homes because standalone 0:19:54.200 --> 0:19:57.800 homes greatly outperformed during COVID, So the two things are 0:19:57.840 --> 0:20:00.960 probably coming together now. But take short break. I have 0:20:01.080 --> 0:20:03.880 some really good questions, including this first one from John 0:20:04.400 --> 0:20:11.679 back in the moment. Hello, welcome back to The Australian's 0:20:11.720 --> 0:20:14.800 Money Puzzlive podcast. Terry Ryder of the Hot Spotting Group 0:20:14.920 --> 0:20:19.400 is my guest today and we are talking about, interestingly, 0:20:19.560 --> 0:20:23.919 I think the power of unit investing, which has been 0:20:24.000 --> 0:20:26.399 much derided, if you like, in recent times. But Terry's 0:20:26.440 --> 0:20:30.399 got some pretty convincing information that the units are hot 0:20:30.640 --> 0:20:32.840 at the moment. Is also you know, I think very 0:20:32.840 --> 0:20:36.640 perspeactively argue that Queensland from original basis, Queensland is where 0:20:36.640 --> 0:20:39.159 it's happening, where it's going to happen, and I certainly 0:20:39.160 --> 0:20:41.320 would have no argument with that. I think all the 0:20:41.359 --> 0:20:45.040 scigens do suggest that. Okay, a couple of questions. John says, 0:20:45.359 --> 0:20:48.680 I thought you tined this interesting. I recently re reviewed 0:20:49.040 --> 0:20:54.760 my property in Victoria, which was the worst by a 0:20:54.800 --> 0:20:59.040 long way of the properties he has. He says, we're 0:20:59.119 --> 0:21:02.160 charged three towns two hundred and forty nine per month 0:21:02.280 --> 0:21:05.000 in rent for a free standing house and Point Cook. Okay, 0:21:05.040 --> 0:21:07.800 so that's the income, and it's a house free standing 0:21:07.840 --> 0:21:11.240 in Point Cook, which is an outer suburb of Melbourne, 0:21:11.280 --> 0:21:15.360 relatively new suburbs. And then he lists it's really something else. 0:21:15.400 --> 0:21:19.639 He lists the set costs, the land tax, the council tax, 0:21:19.680 --> 0:21:22.520 the body corporate at the water rates, and the management fees, 0:21:22.560 --> 0:21:26.200 the insurance fees, the Victorian government mandates that smoke detective fee, 0:21:27.240 --> 0:21:30.760 and it all comes to thirteen thousand a year, one 0:21:30.800 --> 0:21:34.520