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The #1 Reason Why These Properties Soar In Value… While Others DON’T!

The Property Couch

Mon Sep 18 2023



The Armchair Guide To Property Investing mini-series:

  • Based on the best-selling book "The Armchair Guide To Property Investing, How To Retire On $2,000 Per Week"
  • Gives an insider's look at the making of the book, chapter by chapter
  • Originally done as Facebook Live sessions during COVID lockdowns in 2020
  • Instead of reading the book word for word like an audiobook, they told behind-the-scenes stories, chapter summaries, anecdotes, and backstories to bring each chapter to life
  • All audio from these sessions has been brought together for this mini-series
  • Aimed at those who have thought about retiring on $2,000 per week or living a life by design doing what they want when they want
  • The series provides insights and guidance on how to achieve financial independence through property investing

The Tale of Two Houses (Location Importance):

  • Story about two identical houses built during the gold rush era in Melbourne
  • One house located in a leafy eastern suburb and one house located in Castlemaine
  • Both houses were beautifully crafted with similar features and sizes
  • Today, the house in Castlemaine would be worth around $1.5 to $2 million while the same house in Melbourne could be worth between $5 to $7 million
  • Highlights the importance of location in property value appreciation

Demand:

  • Population growth is a key driver of demand for properties
  • People's ability to buy influenced by income levels and interest rates

Supply:

  • Measures supply side through completions and new approvals for brand new properties
  • Greenfield areas carry risk of oversupply due to subdivision development
  • Mega developments with multiple towers also carry risk of oversupply
  • Fully established areas are less likely to experience quick increases in supply
  • Infill sites can introduce some risk of oversupply in established areas
  • Future supply is also an important consideration when assessing the market

Economic Activity and Job Market Proximity:

  • Economic activity is a key factor in property demand
  • Areas with multiple industries and investment tend to have higher job opportunities and wages, leading to increased affordability for buyers
  • Proximity to job markets, especially in bigger cities like Melbourne and Sydney, is highly valued by buyers who want to avoid traffic congestion

Human Behavior and Status Increase/Decrease:

  • Human behavior influences property demand through aspirations for certain lifestyles, status, reputation, and success
  • People are willing to pay a premium to live in desirable areas that align with their desired lifestyle and social standing
  • Avoiding negative perceptions or stigma associated with certain areas can contribute to long-term growth potential
  • Gentrification can change the status of an area over time, making it more desirable for owner occupiers