{"id":5390,"date":"2015-08-14T01:00:18","date_gmt":"2015-08-13T15:00:18","guid":{"rendered":"http:\/\/realestatetalk.com.au\/?p=5390"},"modified":"2015-08-14T01:00:18","modified_gmt":"2015-08-13T15:00:18","slug":"property-investing-is-full-of-myths","status":"publish","type":"post","link":"https:\/\/channels.realty.com.au\/realtytalk\/property-investing-is-full-of-myths\/","title":{"rendered":"Property investing is full of myths – Simon Pressley"},"content":{"rendered":"

 
\nA 3-month study on the historical performance of each of Australia\u2019s 550 Local Government Authorities has been completed and the outcomes have dispelled many investor myths. In today’s show we talk with\u00a0Simon Pressley<\/strong>,\u00a0Propertyology\u2019s managing director.<\/p>\n

<\/h4>\n

Transcript:<\/h4>\n

Kevin<\/b>:\u00a0 A three-month study of the historical performance of each of Australia\u2019s 550 local government authorities has been compiled by Propertyology. Given that some locations have strong capital growth and others have better rental yields, Propertyology calculated a total return and then ranked each LGA from 1 to 550.
\nThe findings of the study produced some fascinating outcomes, and according to Propertyology\u2019s managing director, Simon Pressley, it has dispelled many investor myths. So far, they have released reports on Queensland, Victoria and Western Australia.
\nJoining me now to discuss the findings is Propertyology\u2019s Simon Pressley. Simon, thank you very much for your time.
\nSimon<\/b>:\u00a0 Thanks for having me, Kevin.
\nKevin<\/b>:\u00a0 I mentioned in the introduction that the outcomes of these reports dispelled many investor myths. What were those?
\nSimon<\/b>:\u00a0 Property investing is full of myths, one of which is that population growth rate is the biggest driver property prices, and that was dispelled by this report. There are locations such as Narrabri and Ararat where actually the population has declined \u2013 albeit only a little bit \u2013 over a ten-year period, and they have been among the best performers in all of Australia.
\nAnother common myth is that capital cities are better than regional locations. While you can certainly have some poor performing regional locations, the best performing locations have been more regional than capital cities.
\nKevin<\/b>:\u00a0 Were any of those regional areas on the back of mining?
\nSimon<\/b>:\u00a0 Mining was a common flavor, Kevin, but let\u2019s bear in mind, our study took in a 15-year period, so that\u2019s a long period of time. But right through Australia, the better performing locations, if you narrow it down to a common industry driver, mining and also agriculture were probably the two biggest industries.
\nKevin<\/b>:\u00a0 I guess when people hear of mining, they instantly think of places like Murrumba where there were spectacular increases that were not able to be sustained.
\nSimon<\/b>:\u00a0 That\u2019s true but the best three performing out of 550, number one was Newman, number two was Port Hedland \u2013 both Western Australia regional locations \u2013 and number three was Isaac, which covers Moranbah and Dysart. Those three locations have had some spectacular years in the last 15 years and they\u2019ve had some very poor years, but even factoring in those poor years, they outperformed everything else.
\nKevin<\/b>:\u00a0 I guess it\u2019s great tool if you\u2019re looking to look at property investing over the long term, Simon.
\nSimon<\/b>:\u00a0 Absolutely, yes. For industries like that, timing is very important. I think the big losses are those who board at the top of the market without really understanding what they\u2019re doing.
\nKevin<\/b>:\u00a0 Yes. There is so much detail on the reports, and I thank you for sharing them with me. By the way, too, they are reports that are available on the website. I\u2019ll tell you before we finish this conversation how you can get to them.
\nSimon, there is a lot of detail in those reports. There is far too much for us to cover in the time we have available. What were the standout points for you?
\nSimon<\/b>:\u00a0 Standout points? We were surprised with some of the findings ourselves. As I said, locations like Ararat and Narrabri, they don\u2019t have the big profile of capital cities or even some of the big regional cities, but yet they really have had spectacular performance. They just chug along and don\u2019t get any media attention.
\nThere are places like Wyndham, which is outer Melbourne, that has had the highest population growth rate out of any local government authority in Australia. It has performed okay as a property market but has been far from one of the better ones. I think it\u2019s the thing with population growth. Yes, it drives demand for accommodation; however, if supply keeps up with that demand \u2013 or in some cases, exceeds it \u2013 the overall growth is not going to be as good as what some people may think.
\nThe best performing capital cities? Darwin was ranked number one in the last 15 years followed closely by Perth \u2013 and there again, mostly resources influence there. Sydney, in spite of its current boom over the last two and a half to three years, is still officially been the worst performing capital city over that 15-year period.
\nKevin<\/b>:\u00a0 That\u2019s amazing, isn\u2019t it? Sydney, of course, has those huge peaks and troughs, and that has a major influence over a long period like 15 years.
\nSimon<\/b>:\u00a0 Yes, that\u2019s right. The number one thing, we think, why Sydney hasn\u2019t done as well as what people think \u2013 although it has the biggest population masses of any city in Australia \u2013 is the affordability side of things. Affordability is the number one driver of demand for pretty much all commodities, including property.
\nIt\u2019s only had its boom over the last two or three years, Kevin, because we have historically low interest rates. The low interest rate just compensated for the affordability. But it has the potential to go a complete circle if we have several interest rate rises in years to come.
\nKevin<\/b>:\u00a0 I promised that I\u2019d tell you how you can get a hold of these reports. You can do that by going to the website, Propertyology.com.au. My guest has been Simon Pressley.
\nSimon, thank you so much for spending some time with us today.
\nSimon<\/b>:\u00a0 Thanks for having me, Kevin.<\/p>\n","protected":false},"excerpt":{"rendered":"

  A 3-month study on the historical performance of each of Australia\u2019s 550 Local Government Authorities has been completed and the outcomes have dispelled many investor myths. In today’s show we talk with\u00a0Simon Pressley,\u00a0Propertyology\u2019s managing director. Transcript: Kevin:\u00a0 A three-month study of the historical performance…<\/p>\n","protected":false},"author":176692471,"featured_media":5391,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[10,13,25],"tags":[101],"class_list":["post-5390","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-kevin-turner-sponsored-channels","category-latest-story","category-sponsored-channels","tag-podcast"],"yoast_head":"\nProperty investing is full of myths - Simon Pressley - Realty Talk<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/channels.realty.com.au\/realtytalk\/property-investing-is-full-of-myths\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Property investing is full of myths - Simon Pressley - Realty Talk\" \/>\n<meta property=\"og:description\" content=\"  A 3-month study on the historical performance of each of Australia\u2019s 550 Local Government Authorities has been completed and the outcomes have dispelled many investor myths. 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