Two property experts have advised investors to look beyond the headlines in order to make more informed decisions when it comes to property investment.
In a recent episode of What’s Making Headlines, hosts Phil Tarrant and Tom Panos explained why it is vital for investors to be well informed in the current changing market.
“When it comes to rental rates, it’s a good story for papers, it’s a good story for podcasts, it’s a good story for TV to talk about this crisis that’s unfolding right now,” Mr Tarrant said.
“So, for property investors: Is the world going to fall apart come the end of September because everyone’s going to be off JobKeeper; therefore, everyone’s going to be either moving out of their properties or not going to be able to pay the rent or whatever else is going to happen?”
The duo pointed to the Melbourne market, which is showing falls not nearly as steep as first predicted by many economists when the pandemic began.
“It was interesting that people [who] were very clear and definite about what they thought was going to happen in the real estate market had been quoted in the last 24 hours saying, ‘It’s nowhere near as bad as what we anticipated’,” Mr Panos explained.
“And now we are reforecasting our view that it ain’t going to be a 15 to 20 per cent drop, that it’s going to be more like a 5 per cent drop.
“And that what we probably think will happen is that between 21 and year 23, that what we’re going to do is to have increases of around 20 per cent in Brisbane, increases of around 15 per cent in Sydney, increases of around 12 per cent, I think they said, in Melbourne. But things will probably soften a little bit until June next year.”
However, despite Melbourne being more resilient than leading headlines in March, Mr Panos pointed to the pain being felt for real estate professionals.
“[Leading agents] believe that there’s a fair bit of suffering going on at the moment where people that have to leave their current home can’t even have a physical inspection to look at a property, even if they were going to have an agent that was going to be 10 metres away from them looking at a vacant property with no one in the property,” Mr Panos said.
“And what they’re pleading for the government to actually weigh up the pros and cons. And this is not about necessarily just making sales, which I’m sure matters to real estate agents.”
While pointing to an ever-changing landscape with the health crisis, Mr Tarrant noted investors should look at their own trusted network and not purely rely on external sources.
“This is for real estate agents and mortgage brokers: you can only shape your direction based on the information that you have at any given time. And how do you get information? You use the sources around you. You have trusted advisers. You can pay for advice to make informed decisions,” Mr Tarrant concluded.