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[On-Demand Webinar] Property Update with Dr Nicola Powell

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In this on-demand webinar, we are joined by Domain Group's Data Scientist - Dr Nicola Powell for a property update.

Published in: Real Estate
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[On-Demand Webinar] Property Update with Dr Nicola Powell

  1. 1. Helping you build & manage your property portfolio
  2. 2. Maximise audio quality • Please ensure your speakers are on, volume is up and not on mute. • You can test your audio in the control panel of the Go To Meeting software, under audio preferences. • If you can’t hear us yet, please ensure your speakers are on and turned up. • TURN OFF: Outlook, Skype, online back-ups and any music or video downloads. • Faster internet = better quality audio.
  3. 3. This presentation contains general information only and does not take into account your personal objectives, financial situation or needs and you should consider whether the information is appropriate to you before acting on it. Before acting on any information you should consider seeking advice from a financial adviser and your accountant before making any financial decision in relation to any matters discussed in this presentation. General advice disclaimer
  4. 4. Dennis Wong • Product & Training Manager. • Property investor for the past 10 years • Personal experience with renovations • Great amount of industry experience
  5. 5. • Data Scientist for the Domain Group • Her key objective is to create factual data driven conversations across all media channels. • Nicola provides regular property commentary for local and national media outlets including digital, print, television and radio. • Her passion is translating data to digestible consumer friendly columns. • Within her career she has published numerous academic and interest papers. • She is quickly establishing a name as a notable property commentator in Australia. Dr Nicola Powell
  6. 6. Real Estate Investar • Property investor focused technology company founded 2006 • We help simplify Real Estate Investment • We help property investors make the most of their investment portfolios • 260,000+ investors subscribe to our free membership, news and market reports • 2,800 current members • Mix of personal users, brokers, buyers agents and accountants
  7. 7. ASX:REV • Heavy investment in product • Public company governance • Strong and focused board; • Simon Baker – Former CEO of REA • Anthony Catalano – CEO of Domain
  8. 8. In partnership with…
  9. 9. Our mission is to provide property investors around the world with the best advice, guidance, products and services to enable them to create wealth through property investment.
  10. 10. Investor Insights Who, What and When?
  11. 11. Who is buying?
  12. 12. Three types of property investors Dr Nicola Powell Passive Active Analytical
  13. 13. Three types of property investors Dr Nicola Powell Passive Active Analytical • Limited research • Limited understanding of the investment path, e.g. tax benefits, finance strategy • Purchase quickly • Purchase emotionally • Some degree of research to find a good investment prospect • Understands basic principles • Seeks professional advice • Increased chance of making a viable investment • Seeks extensive advice • Research and analytics are a key foundation • Takes time to commit • Conducts extensive due diligence • Can miss an opportunity Beginner-research Mid-research Deep-research
  14. 14. Three sorts of property investors Dr Nicola Powell Renovator Developer Active Short-term Active Short- to mid-term Landlord Passive Mid- to long-term
  15. 15. What to buy?
  16. 16. Property debate.. Dr Nicola Powell 1. Economic indicators 2. Supply and demand 3. Price point
  17. 17. Dr Nicola Powell Property debate.. a house or a unit? 1. Purchase price 2. Ongoing expenses 3. Maintenance 4. Investment goals 5. Rental potential
  18. 18. New homes Pros Cons Delays and extra costs Growth corridors (over supply) Potential over supply Unpredictable growth Tax depreciation Attractive to tenants Lower maintenance costs Guarantees & warranties Dr Nicola Powell
  19. 19. Established homes Pros Cons Older home Building reports Emotional buyers Maintenance issues Avoid premium of new build Stronger performance in slow markets Value add Negotiate price Dr Nicola Powell
  20. 20. Depreciation New Home Established Home (5-yrs) Asking Price $400,000 $375,000 Land Value $200,000 $200,000 Building Value $200,000 $175,000 Depreciable Amount $200,000 $153,125 Amount ($200,000 x 2.5%) x 40yrs ($175,000 x 2.5%) x 35yrs Real Purchase Price $200,000 $221,875 Dr Nicola Powell
  21. 21. Dr Nicola Powell Off-plan purchasing fundamentals Location Owner-occupied Stock Due diligence Fixtures & fittings Paperwork Depreciation Floor plan Yield
  22. 22. When to buy?
  23. 23. When to purchase? Dr Nicola Powell Key considerations: - Market dynamics - Research sales history - Domain Home Price Guide - Rental vacancy - Domain State of the Market Report - Yield potential - Future development - Research rezoning and infrastructure changes
  24. 24. Trend watch: house prices Source: Australian Property Monitors 1 800 817 616. Copyright APM Pty Limited. Dr Nicola Powell $0 $200,000 $400,000 $600,000 $800,000 $1,000,000 $1,200,000 $1,400,000 Sydney Melbourne Brisbane Adelaide Canberra Perth Hobart Darwin Mar 2017 $1,167,127 $842,221 $533,292 $513,263 $692,313 $564,000 $383,558 $593,707 Dec 2016 $1,129,055 $813,146 $539,412 $506,539 $673,137 $574,458 $369,574 $576,904
  25. 25. Trend watch: house price movements Source: Australian Property Monitors 1 800 817 616. Copyright APM Pty Limited. Dr Nicola Powell 14.6% 15.0% 3.6% 4.6% 8.4% -2.5% 10.3% -4.1% 3.4% 3.6% -1.1% 1.3% 2.8% -1.8% 3.8% 2.9% Sydney Melbourne Brisbane Adelaide Canberra Perth Hobart Darwin YoY Change QoQ Change
  26. 26. Median Unit Price Source: Australian Property Monitors 1 800 817 616. Copyright APM Pty Limited. Dr Nicola Powell Sydney Melbourne Brisbane Adelaide Canberra Perth Hobart Darwin Mar 2017 $741,789 $464,247 $385,987 $299,587 $410,256 $369,594 $283,627 $408,652 Dec 2016 $721,920 $463,169 $393,177 $301,909 $412,189 $383,087 $274,183 $464,148 $0 $100,000 $200,000 $300,000 $400,000 $500,000 $600,000 $700,000 $800,000 Mar 2017 Dec 2016
  27. 27. Units price movements Source: Australian Property Monitors 1 800 817 616. Copyright APM Pty Limited. Dr Nicola Powell -20.0% -15.0% -10.0% -5.0% 0.0% 5.0% 10.0% 15.0% Darwin Hobart Perth Canberra Adelaide Brisbane Melbourne Sydney YoY Change QoQ Change
  28. 28. Trend watch: affordability Source: Australian Property Monitors 1 800 817 616. Copyright APM Pty Limited. Dr Nicola Powell Price constraint for buyers in certain markets $300,000 $400,000 $500,000 $600,000 $700,000 $800,000 $900,000 $1,000,000 $1,100,000 $1,200,000 $1,300,000 Mar-06 Jul-06 Nov-06 Mar-07 Jul-07 Nov-07 Mar-08 Jul-08 Nov-08 Mar-09 Jul-09 Nov-09 Mar-10 Jul-10 Nov-10 Mar-11 Jul-11 Nov-11 Mar-12 Jul-12 Nov-12 Mar-13 Jul-13 Nov-13 Mar-14 Jul-14 Nov-14 Mar-15 Jul-15 Nov-15 Mar-16 Jul-16 Nov-16 Mar-17 Sydney Melbourne Brisbane Adelaide Canberra Perth
  29. 29. Building approvals rise Capital cities tell different stories Source: Australian Bureau of Statistics, Building Approvals, 8731.0 Dr Nicola Powell 0 10000 20000 30000 40000 50000 60000 70000 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 TotalBuildingApprovals Sydney Melbourne Brisbane Adelaide Perth
  30. 30. Greater Sydney Source: Australian Bureau of Statistics, Building Approvals, 8731.0 Dr Nicola Powell 0 5000 10000 15000 20000 25000 30000 35000 40000 45000 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 BuildingApprovals Houses Units
  31. 31. Greater Melbourne Source: Australian Bureau of Statistics, Building Approvals, 8731.0 Dr Nicola Powell 0 5000 10000 15000 20000 25000 30000 35000 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 BuildingApprovals Houses Units
  32. 32. Greater Brisbane Source: Australian Bureau of Statistics, Building Approvals, 8731.0 Dr Nicola Powell 0 5000 10000 15000 20000 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 BuildingApprovals Houses Units
  33. 33. Australian Capital Territory Source: Australian Bureau of Statistics, Building Approvals, 8731.0 Dr Nicola Powell 0 500 1000 1500 2000 2500 3000 3500 4000 4500 5000 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 BuildingApprovals Houses Units
  34. 34. Q&A

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