Weekly Success Tip

The Six Key Market Drivers

Last time we looked at the fifth of six key property market drivers as taught by Mr. Positive Cashflow Property in my new book Think and Grow Rich In Property.

This week we’ll take a look at the final driver #6 – Supply and Demand. Combined, these six key drivers may help us predict where growth will be strongest, and many believe this one is the most powerful of all.

Supply and Demand

“At the time of writing, we are now in the middle of the biggest residential undersupply we have ever seen, some 180,000 dwellings short across Australia. The majority of the shortage is on the east coast of Queensland, New South Wales and Victoria. The Housing Industry of Australia believes that even if we started to build today at record pace – which was 17,000 houses per month when it peaked in 2001 – it would take years to return to equilibrium. And we couldn’t be further from record pace. In fact, right now our construction numbers are the lowest we have experienced in nearly a decade. In November 2008 we experienced the biggest decline in building approvals in eight years. All this information points to a scenario where demand significantly outweighs supply, meaning there will be a strain on the rental market over the approaching years. As consumer confidence returns, massive pressure will be placed on property prices. If you find the areas of undersupply you will be in prime position for growth.

Generally speaking, I look for a minimum of five out of the six key market drivers when I am considering investing in an area. Less than that and you won’t have multiple factors working in harmony to fuel growth.” 

ACTION STEP:

Your Action Step this week, is simply to be sure to enjoy the Christmas break with friends and family. Be grateful and thankful you live in one of the best countries in the world where you are wealthy beyond belief.

Look out for my next success tip early in the New Year with some really exciting announcements. Until then, Merry Christmas ;-)