average return 8% pa over last ten years, standard deviation of returns 8%. This is worse than property trusts 9% pa, SD 8%. Of course, things can change over time but based on the last decade why would you want to invest in bisbane appartments when you could get a better return, same variance (ie better risk adjusted return) from property trusts over a decade and more liquidity ?
property trusts…urghhh. the trouble is the refinancing/credit/consumer boom is funding retail sales which is boosting LPT’s and the economy generally (well so some commentators say). I worry that people trying to diversify by covering negative gearing with property trust income are just playing double or nothing – its all linked in to what many are referring to as the ‘property boom’ (which sort of implies a subsequent ‘property bust’).
Extensive list of ‘Off The Plan’ property available for sale in Perth.John – 0419 198 856
I agree, property trusts don’t excite me (but I had to have a look anyway). I was wondering though why anyone would want to invest in brisbane appts when the average return and variance in returns is so crappers.
It looks like a cyclers market, goes nowhere for ages (ie underperforms inflation) and then goes ballistic in the last 3-4 years of the cycle with 15-45% pa returns, whoa baby ! I think you could use the brisbane house market as an end of cycle leading indicator, moves above 10% indicating the end maybe coming.
Could be a weird sort of brisbane mating ritual, where their returns only get fired up with the prospect of things falling off a precipice.
investing in brissy isn’t mandatory – we won’t actually notice if you don’t.
cheers
brahms
mortgage broker
[email protected]
brisbaneI’m not so sure it’s as predictable as that from past cycles, for at least 2 reasons:
1. The Brisbane inner city appartment market didn’t exist last cycle – it’s a brand new thing.
2. There is so much migration into SE QLD right now, and so many people who live here are from southern states, so the whole demographic is different.
I’m not saying that your figures won’t prove correct, just saying that previous trends may no longer be reliable indicators as the market is substantially different as of the last few years.
Cheers, Mick
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