One of the key elements to be considered when embarking on successful property acquisition when seeking to build one’s property portfolio is real estate market indicators.
Familiarising ourselves with key factors that have regular influence on the property market will ensure a more equipped and educated decision relating to:
c) value of acquisition
For most of us who are not experts in research marketing, it is beneficial to have continued education in these areas and surround ourselves with reputable experts in the field to educate and equip us accordingly.
In general there are 3 basic market indicators that create a platform for determining value, growth and yield and in any particular market at any given time. These include:
1) Federal (government) spending
2) Private investors
3) Population growth
1) Federal spending
Would it be accurate and fair to say that our government is in essence a business with the intention and mindset of growth and prosperity, be it for the nation? That is debatable!! However, it is a definite fact that where federal spending is allocated it is strongly based on extensive and substantial research with the view of return on spend (investment). It is prudent then that as an investor, one should consider and clearly familiarise themselves with current planned and future anticipated government spending in various regions throughout the country.
2) Private Investors
Coles. Woolworths. Bunnings and now Masters. All are familiar names that have formed and etched themselves as a staple in our retail space. However, all are also amongst many others extremely successful in determination via research and planning in securing property acquisitions for the growth and expansion of their ever growing monopoly of the retail space with consistent success wherever they appear.
What factors do these giants take into consideration when determining locations for establishing their outlets?
Amongst many, you guessed it….federal spending. As a prudent investor, it would pay to also take into consideration where private investors are strategically placing their stores.
3) Population Growth
Living in what is in my opinion the best country on earth, often comes with a price. Australia is one of the most sought after destinations for migrants worldwide surprisingly to many not just from cliché origins such as the Middle East and South East Asia but surprisingly from many Western nations as well including the USA, Canada and UK just to name a few. While it is debatable as to the benefits and burden of our ever growing population, one thing is for certain, occupational ownership is constantly on demand!
If one of our biggest business’- the government, and our retail giants, research population growth before determining infrastructure, acquisitions and mergers, then would it not be also prudent to governments and the avid property investor to also familiarize themselves with the undeniable and constant growth in our population in determining our decisions of where to invest at any particular time.
Food for thought….