Mixing Macro and Micro for Property Investment
The Australian property market is currently in a very stable phase. While there is no recession or bust phase in sight, it will be fruitful to learn the right ways of making profits in today’s market. Pete Wargent for Property Update suggests how it may not be the best idea to buy property in your own backyard.
It could work in the past but today, an investor must only look at places where growth prospects are most tangible. A few property investment pointers may help:
- Do not liquidate investments until at least two cycles.
- Build equity and use it for making other investments.
- Use investment profit to create income assets, thus hybridizing portfolios.
- Engage in counter-cyclical investments by putting money in areas that have not shown development for quite a while.
- Stay away from areas that are super-saturated with growth and have shown commendable progress in recent times.
- Follow macro-economic and micro-economic model in tandem for making investments.
The last point needs a little extrapolation. Macroeconomics will help you know where the maximum population growth lies, how industries are panned out and what may be the real wage growth for an area. You can further come down to Microeconomics and find out how properties are doing in a specific area, what are the median prices of the holdings there and so on.
You can read the original article here.
