An article on the website Your Investment Property talks about Mandalay, a Point Piper property, which has been bought for $40 million. Spread over 1900 square metres, it has been purchased by a Chinese immigrant last month. Bill Webb, the former tobacco executive, had listed the property for $40 million- $45 million. The $40 million sale trumps the $39 million paid for the Villa Del Mare mansion last year. Mandalay, originally built in the year 1954, was redesigned four decades later in the year 1994, and has a good view of Manly and the Sydney Harbour Bridge.
You can read the original article here.
When you invest in a property, the idea is to prefigure how enticing it will be to the tenants of the prevailing market and if it will satisfy the requirements of hordes of investors and owner-occupiers if you need to sell it over a short term. While there is no denying the trend, it may not be wise to overlook the present tendency of buyers to hold out long. The only concern they have is whether their asset will register a decent inflation-adjusted capital growth when it is finally time to sell. In this context, the word demographics will be heard of a lot more in the years to come.
In the public perception, property investment has always trumped investment in shares. Perhaps it is a psychological thing or maybe it can be attributed to the ease with which we can relate to the real estate market. Whatever the case may be, there has been a definite inclination towards “brick and mortar”, so to speak. However, this is not to say that the share market is not proliferating and we are not growing up as share traders in our own rights. It is just that the love for property investment beats other pursuits. Let us take a look at a few reasons why this is the case.
Property investors often get confused while choosing between a new property and an established one. There is no dearth of advisers giving reasons in favour of either of them. No matter how hard pressed I am to concede otherwise, I will always root for established properties, and I have good reasons to do so.
Property investors are not averse to the concept of currently-tenanted properties. In fact, they quite like the idea for various reasons. This said, the move can completely backfire and what you stand to gain (because you will fetch rent from the very first day) may not offset what you lose in terms of capital growth. So while choosing an investment property, do not be too swayed by the fact that it is currently-tenanted.
House hunters look for various indicators in the pursuit of making an informed decision. After all, their home or property investment is the one at stake, and it’s but normal for them to make sure those indicators will lead to something good. One smart indicator that they use is the median price. Why is median price such a good indicator?
