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There’s little doubt that 2012 will be a year of economic crises around the world.
But what is certain in these times of uncertainty is that a group of successful property investors will be quietly growing their wealth by taking advantage of the opportunity the market is presenting them.
While many Australians will sit on the sidelines waiting for someone to ring the bell heralding the property market has hit bottom, savvy investors will be out looking for and buying investment opportunities created by the current buyers’ market.
So let’s look at some of the time-tested rules these successful investors use to make their fortunes.
1. They invest, not speculate
Even though they think they are investing, many property investors are actually speculating.  They buy a property emotionally, often near where they live, where they holiday or where they want to retire. Then they hope that the market will appreciate. This makes them dependent on outside market conditions to produce a profit.
Smart investors do it differently.
They make educated investment decisions based on research, buy property below its intrinsic value in an area that has above-average long-term capital growth and then add value through renovations, thereby “manufacturing” extra capital growth.
2. It’s about the property 
Wise investors never forget the age-old fundamental of buying the best property they can afford in proven locations and don’t allow themselves to get sidetracked by glamorous finance or tax strategies.
3. Property is a high-growth, low yield-investment
While the argument about capital growth or cashflow will rage forever, savvy investors know that the fastest way to build a substantial property portfolio is through capital growth.
 
4. Land appreciates
While it’s true that land appreciates in value, it’s not really as simple as that. Not all land is made equal, and not all land appreciates at the same rate.
There’s lots of land (ample supply) in the outer suburbs of our cities, but much of the demand there comes from a small segment of the market – first-home buyers (restricted demand). This keeps a lid on capital growth and makes these areas poor investment prospects.
Even worse, the land component, the bit that appreciates, usually only makes up about half of the total value of the property. However, in the inner suburbs the proportion of the land value to the total property price is usually considerably higher.
Remember it’s the scarcity of land that causes property values in these locations to keep rising and currently there is strong demand from a wide range of owner-occupiers for properties in our inner suburbs. This trend is likely to continue as more of us chose to live close to our workplaces in locations that offer better access to infrastructure like public transport, shopping and entertainment facilities.
As demand looks set to outstrip supply in the inner- and middle-ring suburbs for many years to come, these areas are where successful investors will buy for long-term capital growth.
5. They buy properties that will be in continuous strong demand 
Of course not every property in a given suburb will make a good investment or have similar capital growth. Savvy investors understand that investment-grade properties are the type that will appeal to a wide range of owner-occupiers, since they make up the vast majority of buyers.
That’s why they avoid studios, student accommodation, holiday accommodation and serviced apartments. After all it’s owner-occupiers, not tenant or investor demand, that push up property values in the long term.
6. Demographics holds the key
Long-term demographic trends – where and how people want to live – will determine the type of property that will be in demand in the future.
As our cities mature there will be more one- and two-people households, meaning that secure medium-density apartments and townhouses will become the preffered style of living for more Australians as we swap our backyards for balconies.
7. They have a great team
If you are the smartest person in your team, you’re in trouble. Successful investors surround themselves with a team of top consultants and know how to discern an advisor – who is independent – from a salesperson.
8. They understand where the risk really lies
Most investors believe there is a direct relationship between risk and reward – the higher the reward, the more the risk must be. But that’s not really true.
While most investors think the risk lies in the property or the markets or factors outside their control, the biggest investment risk actually lies with the investor – in knowledge, experience and mindset.
9. They don't diversify
The best defense is a good offence. Wise investors educate themselves and develop a level of financial fluency to make their investment journey as safe as houses.
Interestingly, most successful investors don’t diversify. They specialise by becoming good at one thing, or an expert in one area or niche, thereby getting great results.
10. They understand the property market moves in cycles
During a boom everyone is an optimist and expects the good times to last forever, just as we lose our confidence during a downturn.
Truth is, our property market behaves cyclically and each boom sets us up for the next downturn, just as each downturn paved the way for the next boom. Just as it is doing right now.
Something to think about.
Michael Yardney is the director of <a href="https://www.metropole.com.au/">Metropole Property Investment Strategists</a> , a best-selling author and one of Australia's leading experts in wealth creation through property. He also writes the <a href="https://www.propertyupdate.com.au/">Property Investment Update</a> blog.
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Ten rules for successful property investment

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“I’m not going to invest in property in 2012! It’s going to be a year full of crises. 
“Just look what’s looming in Europe. The China bubble could burst. And the US could have a double-dip recession.” 
These were the words of two of our friends, Gill and John, as they discussed their plans for this year with me. 
I couldn’t really disagree with some of their predictions about the world economy, but I did disagree with their conclusions. 
Interestingly we had a similar chat at the beginning of last year and the year before. It’s interesting how the conversation seems to turn to property when we get together. And every year they find excuses not to invest. 
They own their own home, have paid off their mortgage long ago and while they understand the need to invest to secure their financial future, they are waiting for a stress-free year – a year without crisis – to get into the property market. 
I explained to them that I don’t think we’ve ever had a year without a crisis. Even if the year starts out looking OK, a terrible crisis happens every year. 
As they’ve owned their home for 20 years I recounted some of the crises that happened in that time – things that came out of the blue and changed market sentiment: 
2011 - Floods in Queensland and Victoria, earthquake in Japan, Middle East uprisings that spread around the world, economic woes in Europe
2010 – A federal election that left us with a virtually hung parliament, European debt crisis
2009 – Global economy nearly collapses
2008 – GFC shard market collapse, company bailouts and the Bernie Madoff scandal
2007 – Mortgage crisis in US – the beginning of the financial crisis
2004 – A tsunami hits south-east Asia (it’s the first time I recollect hearing that word)
2003 – Iraq war, SARS panic, interest rates peak halting our booming property markets
2001 – 9/11 terrorist attack, Afghanistan war, economic downturn in Australia
2000 – Dot.com bubble pops and the share market crashes
1999 -Y2K scare, many people put major decisions on hold
1997 – Asian financial meltdown
1993 - World Trade Center bombing
1991 – The recession we had to have and a major Australian property downturn
1990 - Persian Gulf War, rising interest rates hurt property investors 
I left out lots of events, but think I made my point to Gill and John – you can go back as far in history as you like and there won’t be a crisis-free year. Sure some years are worse than others, but there is always bad news, and much of it is unexpected. 
Where investors get into trouble is seeing these as once-in-a-generation events that will alter the course of history, when in reality they are just the normal path of history. 
I asked my friends what they paid for their home when they bought it 20 years ago: $300,000. 
I then asked what it was worth today, considering properties in Glen Iris, an affluent inner Melbourne suburb, had dropped around 10% in value: $1.4 million. 
I reminded them of all the events that had occurred over those last 20 years and all the reasons they used not to get involved in property and then asked the most telling question of all: 
“If you knew then what you know now, would you have done anything differently when you bought your house 20 years ago?” Their answer: “We would have bought more real estate.” 
I then asked if 10 years ago you would have known what property values would be today, would they have bought an investment property. Sheepishly they had to answer yes. 
So what is different today? 
Sure, 2012 will be a year of crisis and there are things lurking around the corner waiting for us. Things we don’t even know about. 
There are two ways to handle this: 
1. Sell up your assets, have a large cash buffer, hug your loved ones and wait for the sky to fall. 
2. Prepare for the worst but expect the best. 
Do you want to know what I’m doing in 2012?
Last year I sold three properties that no longer suited my investment strategy, and I’m actively using these funds in the property market this year. I’ll explain exactly what I sold and what I’m buying at our upcoming <a href="https://www.propertyupdate.com.au/2012-events/national-property-and-economic-market-update/">National Property and Economic Update</a> one-day trainings around Australia over the next few weeks. 
In fact they start in Brisbane tomorrow, March 10, so if you haven’t reserved your place yet, please click here now, find out all the details and join me plus property analyst Michael Matusik, finance strategist Rolf Schaefer and tax expert Ken Raiss.
 
Some people and some companies prosper during a downturn 
Remember that countries, companies and individual investors can prosper in the face of constant crises. During those last 20 years the value of properties in Australia went up by billions of dollars irrespective of who owned them. 
Companies like Apple, Google and Facebook started in teenagers’ bedrooms and became global juggernauts despite years of crises. 
So what’s the lesson? 
The lesson from all of this is:
<ol start="1">
<li>Don’t panic and make emotional decisions</li>
<li>Learn from history</li>
<li>Review your current property portfolio</li>
<li>Refinance if you can to top up your financial buffers</li>
<li>Take appropriate action – whatever this may be for you: 
<ul>
<li> Maybe you should sell an underperforming property rather than hoping it will increase in value, recognising that the gap between your property and better performing assets will only widen</li>
<li>Perhaps you should buying more properties </li>
</ul>
</li>
</ol>
Of course in the short term our property markets will be driven by market sentiment and microeconomic factors. 
But in the long term the value of well located properties will rise propelled by the twin factors that have always driven long-term property prices – population growth and the wealth of the nation. Both will increase substantially. 
I believe the wise King Solomon had an inscription in his ring to keep him humble during good times and give him hope during bad times – This too shall pass. 
Yes, 2012 will be a year of confusion and concern. 
But this is a perfect time for sophisticated property investors, as the ultra-successful always use downturns to create wealth, knowing that average Australians sit in fear waiting for the recovery.
Michael Yardney is the director of <a href="https://www.metropole.com.au/">Metropole Property Investment Strategists</a> , a best-selling author and one of Australia's leading experts in wealth creation through property. He also writes the <a href="https://www.propertyupdate.com.au/">Property Investment Update</a> blog.
 
 
 
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If you wait for a perfect year to invest in property, you will never start

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Here’s a starling but true fact: most Australians who get involved in property investment never develop the financial freedom they were looking for. 
Close to half of those who get into real estate sell up in the first five years, and of those still in the game, most never get past their second investment property. 
However, some investors do very, very well. 
To help you succeed in your investment endeavors, here are four common mistakes property investors make and how you can avoid them. 
1. Buying the wrong property
To achieve financial freedom through property investment you’ll need to accumulate a large asset base. 
This means owning the right properties – ones that grow strongly in value and outperform the averages, so you can borrow against your increased equity and fund further property purchases. 
However, when you ask many investors why they purchased their property they’ll say things like: it was close to where they live, where they holiday or where they want to retire. 
These are all emotional reasons for buying property, and while possibly a good way to buy your home, they are not the right way to buy an investment property. 
Of course the alternative is to buy properties based on research and buy those that further your wealth creation plans. 
 2. Not having a plan 
Most of us spend more time planning our holidays than we do planning our financial future. 
If you don’t have an investment plan, how can you hope to develop financial independence? 
Most Australians fall into four categories: 
a. They don’t invest at all.
The majority of Australians fall into this is the group – they just haven’t taken action yet. 
b. They don’t invest enough. Others have bought a home and understand the power of appreciating real estate, but they want to pay it off before they invest in more real estate. 
This means they are not using the untapped equity in their homes to further their financial futures. 
c. They invest too much. Some people invest too much – yes, that’s possible! 
They have taken unnecessary risks and borrowed too much. Investors who are too highly geared may run into trouble as interest rates rise in the future. 
d. Those who invest the right amount.
Then there are those who invest just the right amount. Not too little. Not too much. They invest the right amount – sounds a bit like Goldilocks, doesn’t it? 
For them every property purchase is part of a thought-out wealth creation plan. 
The problem is that if you don’t have a strategy it’s easy to get distracted by all the “opportunities” that keep cropping up. 
Unfortunately many of these don’t work out as expected. Look at all the investors who bought off the plan or in the so-called next “hotspot”, only to see the value of their properties underperform.  
3. Not reviewing your property portfolio 
While property is a long-term investment and the costs of buying and selling real estate are considerable, that doesn’t mean you should fall into the trap of not reviewing your property portfolio.
Of course you can’t easily “swap” properties or reweight you property portfolio like you would shares. But you should still regularly review your property investment portfolio to see what you can do to improve or upgrade its performance. 
When was the last time you checked to make sure you were getting the best rents or that your mortgage was appropriate for the current times? 
Maybe it’s time to refinance against your increased equity and use the funds to give you a buffer for the uncertain times ahead or maybe to buy further properties? 
And sometimes it is appropriate to consider selling an underperforming property to enable you to buy a better investment. 
Remember in the next phase of our property cycle some properties will strongly outperform others and the gap between your underperforming property and those investment-grade properties will only widen. 
Do you own the type of properties that will allow you to take advantage of the next property cycle? 
If you own secondary properties or real estate in areas that are unlikely to benefit from strong capital growth, it may be worth selling up and replacing them with the type of property that will help you develop long term financial independence. 
4. Not managing your risk 
Growing your property portfolio will depend on you being able to borrow money to hold on to your properties and keep buying more. 
Therefore your ability to service your debts or to borrow additional funds would be a potential risk to you. 
Not being able to service your loans could force you to sell a property. 
Not being able to borrow more would retard your wealth-creation opportunities. 
Of course the risk management solution to prevent this happening is to prepare budgets and cashflow forecasts, manage your exposure to interest rate fluctuations and maintain cashflow buffers. 
Smart investors don’t only buy properties; they buy time by having these financial buffers in their lines of credit or offset accounts, to not only cover their negative gearing but to see them through the ups and downs of the property cycle. 
Another way sophisticated property investors secure their assets is to buy them in the correct ownership structures that protect their assets and legally minimise their tax. Most wealthy property investors own nothing in their own names but control their assets through companies or trusts. 
As Australia moves through the next stage of the property cycle, there’ll be tremendous opportunities for investors to build a substantial property portfolio and gain financial independence. 
The cycle is giving us a gift at the moment. With increased market uncertainty and less demand from buyers, many properties are “on special.” 
Let’s make sure we learn the lessons from the past to help us secure our future.
Michael Yardney is the director of <a href="https://www.metropole.com.au/">Metropole Property Investment Strategists</a> , a best-selling author and one of Australia's leading experts in wealth creation through property. He also writes the <a href="https://www.propertyupdate.com.au/">Property Investment Update</a> blog.
 
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Four common mistakes property investors should avoid

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If like many property investors you’re asking if the property market has bottomed out. You’re asking the wrong question.
During the last week I’ve had a number of questions from the media and even more from clients asking me what’s going on in property and how much further will property values fall.
I guess this is because the latest figures came out showing that median house price are flat in some parts of Australia and still falling in others.
So I thought I’d give you my take on it, and I’m sure not everyone will agree with me.
That’s OK, because I love sparking debate and getting people thinking about what I'm saying.
How do you know what’s really going on?
The problem is, most people just take the information that the media spoon-feeds them as truth, and they miss out on opportunities because they don't really understand what's going on.
I want to give you one of the most important insights that I ever gained as an investor, because it opened up a whole new world of opportunity for me.
Currently there's a lot of debate about whether the real estate market has "hit the bottom". Is property just too unaffordable? Are prices going down more? Is the worst behind us? Are they going back up?
This kind of debate sells lots of newspapers, but the reality is that sophisticated investors don’t care whether the market has bottomed out yet. It doesn’t matter.
Here's why: 
A very, different, but critical insight 
The moment you leave your success or failure up to what direction the market goes, you're in trouble. 
Buying any kind of asset because you're trying to "time the market" and hoping it goes up puts you in serious jeopardy. 
You have no control over your returns, and you're making one of the most common mistakes I see investors make –speculating rather than investing. 
Timing the market is what unsuccessful investors do.
Here's what smart investors do to create long-term wealth:
First, they become educatedin a specific asset or investment strategy.   
They read, they learn, and they understand. They don't just throw money into an investment on a "hot tip" or because everyone else is doing it.
Second,they choose an investment strategy that suits the market.
I can't emphasise this enough.  This is why most investors fail – they choose the wrong strategy for the market they're in.
I learned years ago that there is no such thing as the "perfect strategy".  It doesn't exist. There are always pros and cons. And most importantly is choosing your strategy based on your market.
It may interest you to know that over the last year I’ve sold three properties because of what I see happening to our property markets (yes, sometimes I do sell my properties), and I’ve committed my money to other properties instead.
If you're waiting for the marketing to "hit the bottom", you've missed the point. 
The only way you'll know the market has bottomed is in hindsight – and if you were trying to wait until the bottom, you'll have missed it by the time you can tell when the bottom was.
So what should you do?
Instead of trying to do what is almost impossible (timing the market), the better strategy is to get educated and find out what truly is working in today's markets.
I’ve found that timing is one of the most misunderstood concepts with regard to investing. The truth is successful investors know how to create wealth at any point in a cycle. 
Of course timing matters – you don’t want to buy a property at the peak of the property boom, just to wait three or four years before its value starts to rise again.
But successful investors find that timing isn’t really that important.
Have you noticed how some investors seem to do well in good times and do even better in bad times?
Market timing isn’t really important to them. On the other hand, others do poorly in good times and even worse in bad times. Market timing seems to have very little effect on them either.
Interesting, isn’t it?
Another important point is that there are multiple property markets.
I just looked up the latest statistics and found that over the last year there were a number of suburbs in most states where the median price increased by more than 20% (yes, over the last 12 months). And there were other suburbs where the median price fell by more than 20%.
I’m not necessarily suggesting you buy in these suburbs – in fact there are one or two I would definitely avoid.
But what I’m saying is that while some investors are getting in the game and taking advantage of some of the best buying conditions property investors have experienced in a long, long timem, others are waiting for the timing to be perfect.
How will I know when the timing is right?
It wasn’t that long ago that I spoke with John, who had been waiting for over 10 years for the timing to be “just right” to start investing in property.
The timing will never be “just right”. There will always be challenges, situations, circumstances, obstacles, fears, doubts and things that you are going to have to overcome. The timing is never going to be perfect.
Ten years ago John saw some obstacles and didn’t get into property investment. If he had, chances are that wherever he bought his property it would have doubled in value by now, even if he had made a mistake and paid a little bit too much or bought in the wrong street.
It’s a fact that wealth is attracted to people who are decisive and committed. If you are waiting for the timing to be perfect, the timing will never be perfect to you. 
A window of opportunity?
Currently property investors are being offered a unique window of opportunity, a buyer’s market unlike anything they have seen for a long time.
Sure there are economic challenges out there, but testing times create great opportunities.
The list is long of wealthy Australian property investors who sowed the seeds of their portfolio in the early ‘90s property slump, or the property slump of the early 2000’s with “remarkably poor timing.” These successful investors were busy doing while others were pondering.
Yes, we’re going though a property slump and a major change in the economic landscape.
While the timing might seem unfavourable to some property investors right now, others are going to do very well over the next few years. That’s the way it always has been.
Michael Yardney is the director of <a href="https://www.metropole.com.au/">Metropole Property Investment Strategists</a> , a best-selling author and one of Australia's leading experts in wealth creation through property. He also writes the <a href="https://www.propertyupdate.com.au/">Property Investment Update</a> blog.
 
 
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If you are asking if the market has bottomed out, you are asking the wrong question

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This year has already started out as a year of economic confusion and consternation. 
We all know the strength of our property markets is underpinned by Australia’s economic prosperity, and of course this is closely intertwined with China’s growth. 
However, with the economies of many countries faltering and China’s growth slowing, some are concerned that stumbles in China’s economy could stunt Australia’s economic growth. 
So let’s look at what’s really happening in China and what’s ahead. And more importantly what this could mean to your wealth and mine. 
Why is China growing so fast?
 
In 1978, after years of state control of all its productive assets, the government of China embarked on a major program of economic reform. 
In an effort to awaken a dormant economic giant, it encouraged the formation of rural enterprises and private businesses, liberalised foreign trade and investment, relaxed state control over some prices, and invested in industrial production and the education of its workforce. 
The strategy has worked spectacularly well, and now the People's Republic of China ranks as the world's second-largest economy, after the United States. 
Over the past 30 years it has been the world's fastest-growing major economy, with consistent growth rates of around 10%. China is also the largest exporter and second largest importer of goods in the world. 
What’s ahead?
 
Since 1978 hundreds of millions of Chinese have been lifted out of poverty, yet there’s still a big job ahead, with hundred of millions of rural population as well as millions of migrant workers still living on less than $1.25 a day. 
As China goes through its industrial revolution it plans to more than 350 million people into cities in the next 15 years. 
If you think about it, this means they would be building the equivalent of 17 Australias in the next 15 years. Now that’s a mammoth task, and as Australia’s biggest trading partner China requires massive resources to fuel this growth. 
To help put some perspective to this, ANZ’s Paul Braddick suggests the following could happen in China between now and 2025:
<ul>
<li>350 million more people will move to the cities – 103 million have moved since 1990</li>
<li>221 Chinese cities will have more than 1 million people living in them – the whole of Europe has 35 million today</li>
<li>1 million kilometres of new road and 28,000 kilometres of metro rail will be laid</li>
<li>170 mass-transit systems will be built – twice the number that all of Europe has today</li>
<li>40 billion square metres of floor space will be built in 5 million buildings</li>
<li>50,000 skyscraper will be built (of more than 30 storeys) – the equivalent of building two Chicagos every year</li>
<li>97 new airports will be built</li>
<li>One in seven planes assembled by Boeing and Airbus will be delivered to China</li>
<li>1,000 MW of coal-fired power capacity will be commissioned every week – equivalent to four million tonnes of new coal demand</li>
<li>One wind farm turbine will be built every hour and a half </li>
</ul>
What’s happening in China now?
 
China’s economic growth is enormous at around 9% per annum. While this is likely to drop a little over the next few years, the growth in some of its big cities is almost double that. 
Interestingly, there are currently 16 cities the size of London in China. Cities I’ve never heard of. 
Have you heard of Changsha, Chengdu and Chongqing?  Neither had I. 
What about Weifang or Wuhan? 
Cities like these are the backbones of China’s 30 or so provinces whose astonishing economic growth is largely responsible for keeping the world’s economy in black numbers. For example, the economy of Shandong province itself is larger than those of several G20 countries. 
This is not only creating a new middle class in China but also a new group of very wealthy individuals.  According to a study by Julius Baer Group, China’s millionaires account for about half of the rich people across the 10 major economies in Asia, and the number of millionaires there will more than double in number to 2.8 million by 2015 
What does all this mean for Australia?
 
Australia stands poised to capitalise on an economic transformation unparalleled in our nation's history, with a resources and commodities boom capable of generating $480 billion of exports a year and creating 750,000 jobs in the next 20 years.
 
But there’s more to it than that. 
Currently more than 80% of our exports to China are resources; however, looking forward China offers markets of enormous proportions for all the modern services that a developed economy like Australia has to offer. We are in a prime position to supply the world’s fastest-growing major economy with food as well as a raft of products and services. 
One more thing… 
If we play our cards right, Australian tourism could be boosted as we become the playground of the new rich in China who will want to holiday in a nearby country, just as we were a preferred holiday destination of the Japanese in their heyday in the 1980s. 
According to the ANZ Bank, almost $2 trillion needs to be invested in the Australian economy for our nation to capitalise on the mining boom caused by the developing world's march towards urban industrialisation. 
While our new economy will be underpinned by mining, the benefits will flow through to the services, education tourism and our property markets. 
Sure there will be ups and downs and lots of problems ahead, however we are indeed the lucky country and our economy will remain the envy of the developed world. 
Needless to say – a strong economy is good for our property markets. 
So, if like me, you are confident that Australia has a prosperous future, our current softer property markets could be the ideal time to start or add to your property investment portfolio. 
I am going to explain exactly what I’m doing about it personally when I’m joined by finance strategist Rolf Schaefer and tax specialist Ken Raiss as we conduct our <a href="https://www.propertyupdate.com.au/2012-events/national-property-and-economic-market-update/" target="_blank">National Property &amp; Economic Update seminars</a> in five states in the next few weeks.
Michael Yardney is the director of <a href="https://www.metropole.com.au/">Metropole Property Investment Strategists</a> , a best-selling author and one of Australia's leading experts in wealth creation through property. He also writes the <a href="https://www.propertyupdate.com.au/">Property Investment Update</a> blog.
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How Australian property markets will benefit from China’s industrial revolution

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If our economists are armed with all the research available in today’s information age, why can’t they agree on where are our property markets are heading? 
In fact a better question would be, why do so many get it wrong? 
The simple answer is that market movements are far from an exact science. 
It’s more than just fundamentals that move markets. 
The fundamentals – like population growth, supply and demand, employment levels, interest rates, affordability and inflationary pressures – are easy to monitor. 
However, one overriding factor that the experts have difficulty quantifying is investor sentiment. 
In a recent report, AMP chief economist Dr Shane Oliver explains that people often suffer lapses of logic when investing and many of their investment decisions are driven by emotion. 
For example, we tend to extrapolate the present into the future. When things are booming we think the good times will never end, and when the market mood is glum, we have difficulty seeing the light at the end of the tunnel. 
Think about it – when the media reports falling property prices or an impending housing crash, many investors become scared and sit on the sidelines, believing the end of property is nigh and things will never improve, when in reality much of the risk has been removed from the market. 
Conversely, when property markets are booming and stories of investors seemingly making large gains overnight abound, people want to jump on the bandwagon and cash in – often at a time when the market is near its peak.
 
Other emotional traps include becoming overconfident, wishful thinking and ignoring information that conflicts with your current views. In other words many investors create their own “reality”. 
Can you see how this type of activity, influenced by investor psychology, drives booms and busts? How the dominant investor mentality of the time helps drive the property cycle? 
Simply, when investors put on the brakes, housing values tend to stagnate or fall due to lack of demand. And when they jump back into the market, demand rises and up go prices. 
Obviously one or two misguided investors won’t be able to influence property prices, but investor sentiment is contagious. 
People tend to want to do what others are doing – they follow the crowd because going against popular opinion is seen as risky. What if you make a mistake? What if the others are right and you are wrong? 
Oliver says this “collective behaviour” is magnified by several things, including; 
<ul>
<li>
Mass communication enabling the behaviour to become infectious. Now more than ever we are bombarded with messages from the media influencing how we think and feel about things. When we hear that real estate is doomed, all but a handful of sophisticated investors get scared out of the game. And when the media tells us housing markets are booming everyone wants a piece of the action.</li>
<li>
Pressure to conform If your friends or family are doing it, it must be right. Right? Human nature makes us reluctant to do the opposite of what our peers are doing. </li>
<li>
A major precipitating event can give rise to a general belief that motivates investor behaviour. The global financial crisis scared waves of investors out of the markets. On the other hand, the resource boom enticed thousands of investors into west coast housing markets to cash in. </li>
<li>
A general belief that grows and spreads When the belief that property values can only go up spreads through an uneducated new generation of investors they enter the market pushing prices up even further, perpetuating the belief and helping make it a reality. Similarly when the crowd believes the market is going to crash, they steer clear, this gets reported in the media and the negative sentiment feeds on itself. </li>
</ul>
Oliver observes that these “lapses in logic” by individual investors and the magnification of such lapses by crowd psychology feeds property cycles and goes a long way in explaining why we see boom and slumps at different points in time. 
When investor sentiment is positive, the crowd jumps in feet first, pushes up demand and places upward pressure on prices – causing boom conditions. Conversely, when sentiment is negative, the crowd backs off and frequently sells out of the game due to concerns that they’re about to lose everything – causing market slumps. 
What can an investor learn from this? 
<ol start="1">
<li>Our property markets are not only driven by fundamentals, but also by the often irrational and erratic behaviour of an unstable crowd of other investors.</li>
<li>Booms never last forever, neither do busts. Don’t be surprised when they come around, and don’t overreact. According to Oliver, this will help you avoid being sucked into booms and spat out during busts.</li>
<li>Treat your property investments like a business and stick to a proven strategy to take the emotions out of your investment decisions.</li>
<li>Recognise that property is a long-term play and set up financial buffers to help you ride the property cycles. </li>
</ol>
Invest counter cyclically.
Warren Buffet once said: “We attempt to be fearful when others are greedy and to be greedy only when others are fearful.” 
This is also the investment strategy of many successful property investors. 
I’ve always been an advocate of counter-cyclical investing. I’m often sceptical of conventional wisdom – not because the crowd is always wrong, but because the crowd is always late. 
Sure, it takes some courage to do the opposite of what everyone else is doing, but the results of your contrary behaviour will ultimately speak for themselves.
Michael Yardney is the director of <a href="https://www.metropole.com.au/">Metropole Property Investment Strategists</a> , a best-selling author and one of Australia's leading experts in wealth creation through property. He also writes the <a href="https://www.propertyupdate.com.au/">Property Investment Update</a> blog.
 
 
 
 
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Why economists’ property predictions are so often wrong 

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Probably the biggest property myth of 2011 was the claim that Australia was in a “property bubble” that was about to burst. 
It was only a few years ago when “doomsday economist” Steve Keen predicted Australian house prices would plummet. Awkwardly for him, average house prices went up 40% rather than down. 
Interestingly, he now predicts that house prices will fall around 10% this year. I must admit I can see property values falling further in some areas, but I don’t see a property crash happening. 
Watch out for the economic tsunami 
Let’s not forget Harry Dent, another purveyor of doom, who came to our shores last year warning that an economic tsunami was about to hit. Starting in Europe, Dent predicted the downturn would spread to the US, China and eventually Australia, causing property values to drop to levels not seen since the late 1990s. 
He was right about the economic troubles facing most of the world, but I don’t think he understands the fundamentals of the Australian property markets. 
I’m not suggesting we are immune to the overseas problems, clearly we are not, but I can’t see a property crash occurring here. 
What about affordability? 
Throughout the year there were cries that housing is unaffordable and “something” had to be done. 
The year finished off with<a target="_blank" href="https://www.propertyobserver.com.au/residential/australian-housing-market-more-at-risk-than-pre-gfc-america-the-economist/2011112852565"> The Economist magazine warning that Australian house prices could plunge</a> by as much as 25% on the back of a global credit crunch caused by the European meltdown. This is not as bad as last year when the pundits suggested our property markets were overvalued by 61%, based on the ratio of house prices to rents.
 
This year started off with the latest <a target="_blank" href="https://www.propertyobserver.com.au/residential/sydney-and-melbourne-in-the-top-five-least-affordable-cities-in-the-world-demographia/2012012353110">Demographia International Housing Affordability Survey</a> reporting that “Australia exhibited the worst housing affordability of any national market outside Hong Kong".
So is our property market really so overpriced and is there a bubble waiting to burst? 
Let’s start by looking at the latest figures from RP Data. They suggest Australian property values fell by 3.6% nationally for 2011, with Brisbane and Melbourne experiencing a 6.8% and 6.1% market value decline respectively.
 
The most recent Australian Bureau of Statistics figures suggest capital city house prices fell 4.8% over the last year. 
The predictions of a property market crash just did not eventuate in our main capital cities. 
Of course, it did in some of our holiday locations, like the Gold Coast and the Sunshine Coast, but these were never really areas to invest in. 
I know some property pessimists would argue that the bubble is just getting bigger and bigger, which means Australia is heading for an even larger property crash. 
Is housing really unaffordable? 
I agree that to many, housing in Australia is expensive. But that’s what comes from having large dwellings in some of the best spots in the world to live. 
Let’s face it, house prices got ahead of themselves in some parts of Australia and have since corrected, especially in the more affluent areas and holiday locations. 
But that does not necessarily mean property is unaffordable or that it is going to crash. 
The most commonly used benchmark to determine whether housing is affordable is if it costs less than 30% of the household income. However, some households can afford to spend more than half of their income on mortgages or rents, while others struggled when housing ate up 30% or less of their gross earnings. 
Another way of measuring affordability 
A new <a href="https://www.ahuri.edu.au/themes/housing_affordability/">study</a> by the <a target="_blank" href="https://www.ahuri.edu.au/">Australian Housing and Urban Research Institute</a> strongly suggests that the traditional method of calculating housing affordability is outdated and should be considered in conjunction with other ways of weighing up whether people can afford their mortgage or rent. 
According to a paper from the United States Census Bureau, the rule that households can devote 30% of their income to accommodation costs before the household is said to be "burdened" evolved from the United States National Housing Act of 1937. 
Times have changed a lot since then; we now live very differently. 
There are a lot more DINKS (double income no kids), SINKS (single income no kids) MINGLES (middle-aged singles) and one-person households. 
Yet another way of looking at affordability 
Property commentator<a target="_blank" href="https://www.propertyobserver.com.au/residential/housing-affordability-in-australia-is-not-as-dire-as-you-think/2011121352823"> Michael Matusik suggests</a> that instead of the 30% rule, one should look at the income left over after debt servicing, as this approach paints a different picture to that obtained simply by calculating the proportion of income devoted to repayments. 
Rising incomes have allowed households to meet rising loan repayments while maintaining (and often increasing) living standards. 
Matusik believes that rising household incomes mean that the 30% traditional affordability benchmark is now outdated. 
In fact, given higher income levels now, households can devote as much as half of their income to debt servicing, while maintaining the same standard of living. 
The AHURI study I mentioned above found similar results. 
Now don’t get me wrong, I’m not saying that some people are not suffering from mortgage stress. What I am saying is that some households can easily afford 50 to 60% of their income going on rents or mortgages and still have plenty enough left over. 
What it boils down to is that potential first home buyers need to understand that buying your first property is not easy. It never was. 
It involves saving discipline, sacrifice and compromise and perhaps not purchasing your “dream home” straight away. 
Why I don't think the Australian property market will crash 
Currently a tug of war is affecting our property markets, with low interest rates pulling hard on one end of the rope and economic uncertainty joining forces with subdued prospects for economic, income and employment growth at the other. 
I expect the economic side of the equation to win out in the near-term, influenced in the first half of 2012 at least by continuing global financial turbulence. 
This will mean property values are likely to remain flat in most parts of Australia for the first half of the year. 
But our overall market is unlikely to collapse. For that to occur we would need to have high interest rates, massive unemployment, a recession or a failure of our banking system. 
I can’t see any of these events happening in the foreseeable future. 
In the meantime, we’ll see more US analysts surprised that Australian real estate hasn't collapsed as their market has. The problem is that these economists keep analysing Australian properties as if they were shares – it's like comparing apples with oranges. 
Remember in Australia, 70% of properties are bought by owner-occupiers. And one of the things that keeps pushing our property prices up is that, by and large, these property owners all want to live in the same areas. 
If you think about it, 70% of our population lives in one of eight capital cities and most of these people want to live in the inner and middle ring suburbs, near the city, near amenities and near their jobs. 
Secondly, Australia doesn't have suburbs full of empty houses awaiting mortgagee sales like the US. And despite our population growth falling lately, it is still growing at a rate faster than most developed nations. 
Sure, some Australians currently have issues with housing affordability and are putting off their home buying decisions. But people still need a roof over their heads. People are still getting married and people are still getting divorced, some are having babies and others have to move house for their jobs. 
If they can't afford to buy a house they rent one, hence vacancy rates are at unprecedented lows and pushing up rental prices. 
We are moving into the next stage of the property cycle 
And the next stage is the stabilisation phase of the cycle.
<img src="/images/stories/yardneygraph.jpg">
You see, the markets don’t move directly from the downturn phase to a property upturn. There is a period of time where buyers return and take up the slack before prices start rising. 
And I expect more buyers to return to the market this year when they realise prices won’t fall any further. 
By the way, the stabilisation phase is a great time for savvy investors to get set for the upturn stage of the cycle.
 
This year may be a good time to buy property – I have always found it a good time to buy when everybody tells you that property is a bad investment. 
Now is the time to get set for the future.
Michael Yardney is the director of <a href="https://www.metropole.com.au/">Metropole Property Investment Strategists</a> , a best-selling author and one of Australia's leading experts in wealth creation through property. He also writes the <a href="https://www.propertyupdate.com.au/">Property Investment Update</a> blog.
 
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Australian housing price bubble is a myth: Michael Yardney

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It looks like the Australian housing market will be a “tug-of-war” this year with low interest rates pulling hard on one end of the rope and economic uncertainty joining forces with subdued prospects for economic, income and employment growth at the other. 
I expect the economic side of the equation to win out in the near term, influenced in the first half of 2012 at least by continuing global financial turbulence. This is likely to cause the RBA to drop interest rates once or twice in the first half of the year, and this should underpin our property markets. 
However, renewed economic strength is likely to return in 2013, and with it higher interest rates. 
Among all the bad news, there is always good news…
 
While I can see value of some properties falling further in the first half of this year (2012 is likely to be another bad year for top-end and holiday property), prices have stabilised in some suburbs and they haven’t stopped rising in others – in particular Sydney’s inner-suburban market.
What’s ahead? 
The long-term trend of our property markets is fuelled by the fundamentals of supply and demand (and this will be driven by our population growth) and our ability to pay more for housing (which will be underpinned by a nation that is going to become wealthier as the resources boom takes hold.) 
However in the short term, market sentiment will affect our property markets, as it always does. 
Last year ongoing economic uncertainty, the worry of rising interest rates for much of the year, decreasing affordability and political uncertainty were a volatile mix that stalled the property markets. 
So here are the factors that will affect our property markets that I’m going to watch out for this year. 
1. The European situation.
Every time it seems that our friends in Europe have reached agreement on a deal to solve their problems another bogeyman jumps out from the shadows.
If the European Union breaks up or the region slumps into a prolonged recession, the consequences could be:
<ul>
<li>A further dampening of general business and consumer confidence</li>
<li>A knock-on effect to other economies including the US and China, which both export a significant amount of goods to Europe. The eurozone only accounts for less than 10% of Australian exports, but we could be affected by the impact on our trading partners in Asia.</li>
<li>Effects on the global financial system. It is possible that it will be more difficult to get loans from Australian banks because international inter-bank lending could freeze up as it did at the beginning of the GFC. </li>
</ul>
What this means is that now may be a good time to top up your financial buffers while you can, even if you don’t intend to buy more properties this year. 
Topping up your line of credit shouldn’t cost you anything, and of course you don’t pay interest on your unborrowed limits. 
Wise investors use these lines of credit to buy themselves time. Maybe that’s what you need, just in case 2012 pans out to be a difficult time for Aussie banks. 
2. A slowing in China 
China’s growth and its requirement of our resources have bolstered the Australian economy. 
China’s economy is slowing down now and catching its breath, and this won’t be helped if Europe falls into recession. 
By the way, it looks like the US is turning around and should strengthen over the year (with a US election looming), however unforeseen global events could slow the US economic recovery. 
3. Interest rates
Interest rates are likely to remain low worldwide, and I expect the Reserve Bank to try and bolster both consumer and business confidence by dropping interest twice more in the first half of this year. 
This plus flat property prices should underpin housing affordability and put a floor under property prices. 
One question many are asking is: will the banks pass on all of these rate cuts? 
4. Inflation
One of the reasons the Reserve Bank lowered interest rates is because inflation sat within its “safe range”, and local inflation should again remain under control for much of next year. 
However, our improving economy and the ongoing resources boom may cause inflation to take off again over the next few years, which could make things more difficult to live with if you’re in the “low-speed” non-mining part of the economy. 
The time may come to lock in some of your loans and take advantage of fixed interest rates when they are historic low levels. 
It may also be a good time to get set for the next stage of the economic and property cycle and buy the right type of property – one that will be a good hedge against inflation. 
5. Watch out for the X factor
Many years ago I learned from economist Don Stammer that we need to allow for an X factor: the big influence that had not been generally predicted or allowed for but that comes out of the woodwork and has a marked effect on the economy and our investment markets. 
This means I’m going to allow for uncertainty and surprises throughout the year. 
What does all this mean?
There’s no sugar-coating it: last year most of Australia was in the slump stage of the property cycle, but this year the cycle will move on, as it always does. And the next stage is the stabilisation phase of the cycle.
<img src="/images/stories/yardneygraph.jpg">
You see, the markets don’t move directly from the downturn phase to a property upturn. There is a period of time where buyers return and take up the slack before prices start rising. 
And I expect more buyers to return to the market this year when they realise prices won’t fall any further. 
By the way, the stabilisation phase is a great time for savvy investors to get set for the upturn stage of the cycle.
 
This year may be a good time to buy property – I have always found it a good time to buy when everybody tells you that property is a bad investment. Now is the time to get set for the future. 
Michael Yardney is the director of <a href="https://www.metropole.com.au/">Metropole Property Investment Strategists</a> , a best-selling author and one of Australia's leading experts in wealth creation through property. He also writes the <a href="https://www.propertyupdate.com.au/">Property Investment Update</a> blog.
For more forecasts for 2012, <a target="_blank" href="http://propertyobserver.com.au/ebooks/free-ebook-property-forecasts-for-2012">download our free eBook</a>.
 
 
 
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What 2012 has in store for Australia's property markets

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I predict that this is going to be a boom year! 
But before you start wondering what I’m “on” to make a comment like that, let me explain: I believe this is going to be a boom year for fright. 
There is no shortage of scary stuff in the media. Things like "House prices are unaffordable!"; "Property prices will crash"; "Europe’s financial system will fall apart”; “Which economy will topple next?”; “It’s China’s turn for a property bubble”; “Will America go into recession again?"; "Britney Spears does it again!" 
Every year is a boom year Of course just about every year is a boom year for fright.
As far back as I can remember there have always been scary stories in the media.
And looking back over the years I have invested through many property slowdowns, share market crashes, periods of double-digit interest rates and periods when people thought housing was unaffordable or would never go up in value again. Yet despite all of this the value of my properties keeps doubling, allowing me to refinance and buy even more properties.
Like I said, there’s always bad news in the media. I remember in the late 1980s the cry was, "Don't buy houses... they can't go up in value. Your kids will never be able to afford them." Then there were similar headlines in late 2003 and predictions of our property markets collapsing in 2008.
There always seemed to be scary headlines about a grim future that could have given me plenty of reasons not to invest in property. Before the global warming crisis there was an over-population crisis with politicians, environmentalist and economists predicting massive food shortages, rioting in the streets and an impending collapse of society.
I even recall a panic about global cooling.
Of course, the media gets more mileage out of this type of story. Journalists find it hard to get readers’ interest reporting on the unemployment rate being well below the long-term average, an economy that is the envy of most nations, a resources boom the likes of which we haven’t seen in a century and 19 years of continuous economic growth for Australia. This is boring.
Take a long-term view As a property investor you need to take a long-term view and refuse to be scared by the next boogey man jumping out from behind the bushes.
To be successful you need to step back and take a big-picture view.
The fact is, this week somebody's getting married, somebody's looking forward to having a baby, somebody's getting promoted, somebody's getting transferred, somebody's getting divorced. A lot of people are happening to get rich.
This year more than 150,000 new households will be formed in Australia and they are all going to have to live somewhere. Those who can’t afford to buy will have to rent.
This means the long-term fundamentals – in fact the medium-term fundamentals – for our property markets are very sound. And if you take a long-term perspective, you'll be able to spot and act on opportunities that arise this year, as many potential home buyers and investors get scared by this boom year for fright.
Is this a year of opportunity? This could well be a year of opportunities for property investors who are willing and able to see the big picture.
But remember: what you look for is what you see.
If you look for bad news you’ll find it. On the other hand if you look for opportunities, you will find them. And boy, are there opportunities out there at present.
What determines property prices? While many factors, including supply and demand, affordability, interest rates and the economy, affect property values, I have observed:
<ul>
<li>Short-term property price movements (one to three years) are usually determined by market sentiment (which is currently very low)</li>
<li>Medium- to long-term property price movements are determined by two main factors: population growth and the wealth of the nation.</li>
</ul>
Despite what some people would like, strong population growth in Australia is a given (to replace our ageing baby boomers) and as a matter of fact so is our increasing wealth. I don’t think that anyone would argue that as a nation Australia will become wealthier over the next 15 years.
Australia is well positioned to benefit from the growth of Asia, which represents 50% of the world’s population. We have vast resources that will be required by our growing neighbours and we’re at the beginning of the mother of all resources booms.
However, rising property prices, decreasing affordability, changing sentiment and fluctuating supply were a volatile mix that caused our property markets to slump. And now we are in a buyers’ market.
But the funny thing is that buyers don’t buy in a buyers’ market – yet smart investors do! They recognise that the current market presents them with a smorgasbord of opportunities and they step up and take advantage of them.
I’ve found that when there’s lots of bad news people believe times are going to be tough forever, just like when things are good people forget the bad times ever existed and think that things are going to remain good forever.
Neither case is true!
In fact during booms people are most confident when they should probably be the least confident, as things can’t continue travelling at breakneck speed and above average rates of growth. Similarly, during the market slowdowns, things eventually turn around. Ironically, people have the least confidence when it’s more likely that things are going to improve – that is, when markets are near their lowest point.
Now is the right time to educate yourself and get set to take advantage of the opportunities that this stage of the cycle presents.
Yes, things have slowed, and property prices have fallen over the past 18 months. And they will continue to fall in some areas. But this is a normal part of the ups and downs of the property cycle. As always, while some people worry about the bad news and sit on the sidelines, astute investors will set themselves up for the next stage of the property cycle by purchasing well-located real estate.
Michael Yardney is the director of <a href="https://www.metropole.com.au/">Metropole Property Investment Strategists</a> , a best-selling author and one of Australia's leading experts in wealth creation through property. He also writes the <a href="https://www.propertyupdate.com.au/">Property Investment Update</a> blog.
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This year will be a boom year – for scaremongering

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Why are some property investors able to grow significant wealth while others who have the same information, the same opportunities and the same resources are just not able to make a success of their investments?
Here's why: While certain knowledge, techniques and strategies are critical in becoming a successful property investor, it is just as, if not more important, to have the right mindset.
The fact is that both poverty and riches are the result of a state of mind, which means you must develop a prosperity consciousness and become financially successful in your thinking before you can achieve it in reality.
<h3>Why you must change first</h3>
One of the most important steps you can take along your road to financial independence is a change in your mindset, your way of thinking. This must happen before anything else happens, because most of us were programmed to fail in our early childhood.
Much of what we know about money is based on false assumptions because we've been taught a range of myths and misconceptions about what it takes to create wealth.
Most Australian's were taught to think "poorly" by their parents, teachers and the media. And they just take for granted what they were told in much the same way as others assumed the world was flat. As a consequence only a small percentage of Australia's join the ranks of the wealthy.
How can they? They are building their foundation of wealth on a shaky groundwork.
Let's have a look at some of the false assumptions you may have been taught.
<h3>1. A good job will make you wealthy</h3>
Many of us were taught to get an education, find a good job and work hard at it. But this rarely leads to wealth. You become rich when small efforts produce large results. Poverty is when large efforts produce small results.
You should see a job as a temporary inconvenience, a method of generating cashflow for living expenses while you grow your property portfolio, which will eventually become your source of financial independence.
<h3>2. Saving is good</h3>
How many millionaires do you know who became wealthy by saving their money? Don't get me wrong – saving is a required discipline when you begin your investment journey because you need to save your funds to develop a big enough kitty to invest in growth assets, but you can't save your way to wealth.
<h3>3. Debt is bad</h3>
While there is some truth to this, it depends on what kind of debt you are talking about. Consumer debt is bad, so avoid borrowing money to buy things that go down in value. But borrowing money to invest is another story. You can not become wealthy without some form of investment debt. Borrowing to purchase investment properties is a wise use of investment debt.
<h3>4. Failure is bad</h3>
I have had my share of failures and mistakes and I used to be ashamed of them, until I realised that failure is a part of success. A very important part.
If you develop a positive mental attitude about failure you can learn a great deal from it. One of my early mentors had gone broke three times before he became one of Australia's most successful property developers. In fact, I don't know any successful people who have not risen to the top without some failures.
Successful people often have more failure than failures do. But they keep going. Failure is not bad. In fact, one good failure can teach you more about success than years of studying at university. Failing can be the best thing that ever happened to you
<h3>5. Wealth is measured by material possessions</h3>
It took me many years to realise that wealth is much more than money. Money is just one of the appearances of wealth, which is really a state of mind, an attitude. Wealth is your thoughts, not your things. You can become wealthy without having lots of money and you can be rich yet not wealthy.
<h3>6. Abundance not scarcity</h3>
Successful investors have a feeling of abundance, while many Australians have a scarcity mindset. They see wealth as a win/lose game. A dirty business in which the rich take advantage of the poor. That's why they have come up with the expressions such as "filthy rich" or "dirty money".
The truth is, whatever amount you get has nothing to do with how much or how little anybody else has. It never has and it never will. Those with an abundant mindset believe they don't have to steal from your pile in order to get create a larger pile for themselves. Your wealth is in addition to and not in subtraction to anybody. Unless you truly believe this you will always suffer from wealth inhibition.
The sad reality of life is that because of their programming many people assume that wealth is the result of luck, connections or inheritance. The last thing they want to hear is the plain truth that the rich think differently from the average Australian, or that they have a different mindset and different expectations when it comes to money.
<h3>How do you develop a wealthy mindset?</h3>
The first step is to understand how your programming as a child has caused you to make certain assumptions that have now become your reality – the way you filter what comes into your mind from the outside world.
Then you need to model wealthy people who have gone before you and done what you want to do. Look at successful investors and study what they do, how they behave and how they think, and then do the same.
And guess what? By taking this approach you can often repeat their success.
Michael Yardney is the director of <a href="https://www.metropole.com.au/">Metropole Property Investment Strategists</a> , a best-selling author and one of Australia's leading experts in wealth creation through property. He also writes the <a href="https://www.propertyupdate.com.au/">Property Investment Update</a> blog.
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Six ways successful property investors think differently

Buyers considering a residence at boutique Gordon townhouse development <a href="https://www.apartments.com.au/new-townhouses/lume-gordon-43-47-dumaresq-street-gordon-nsw-2072">Lume</a>&nbsp;now have another reason to bring forward their decision.

For a limited time, purchasers of a residence at Lume will receive a BMW iX3 50 electric SUV, valued at more than $120,000, as part of their purchase. The offer is designed to add value for buyers while complementing the lifestyle envisioned for the architecturally designed Upper North Shore development.

Scott Timmins, Development Manager at <a href="https://www.apartments.com.au/developers/winim">WINIM</a>, said the partnership was created to provide buyers with a compelling reason to act.

"In today's market, buyers need a compelling reason to act now, and the BMW partnership was designed to create that catalyst. We wanted to add genuine value for our future purchasers. Choosing the all-electric BMW iX3 50 also reflects the values behind LUME, forward-thinking design, innovation and a more sustainable way of living. It's a premium incentive that complements the lifestyle our buyers aspire to and rewards those who commit early."

[smartcode_project:default project_id=7354 project_image_fid=374893]

Delivered by WINIM in partnership with Burtonwood Investment Partners, Lume comprises 14 architecturally designed two, three and four-bedroom townhomes created for families seeking the space of a freestanding house with the ease of modern, low-maintenance living.

The three-storey residences, designed by award-winning architecture practice <a href="https://www.apartments.com.au/architects/rothelowman">Rothelowman</a>, have been tailored for families and multi-generational living, featuring private internal lifts, flexible lower-level spaces, generous open-plan living and entertaining areas, media rooms, and landscaped outdoor spaces with custom outdoor kitchens.&nbsp;

Inside, engineered oak flooring, bespoke dining joinery with integrated wine fridges and backlit bars, sculptural porcelain bathrooms, Parisi freestanding baths and Astra Walker tapware create interiors that balance functionality with refined finishes.

Each townhome has been designed to combine generous internal spaces with sustainability initiatives such as EV charging infrastructure, while <a href="https://www.apartments.com.au/landscape-architect/arcadia-landscape-architecture">Arcadia</a>'s landscaped communal areas, centred around a restored creek line and native planting, encourage residents to connect with nature and spend more time outdoors.

[smartcode_project:default project_id=7354 project_image_fid=269527]

Rothelowman's Gary Tsui said the architecture was conceived to respond carefully to its Upper North Shore setting.

"Our vision was to create elegant, uplifting homes that draw on and positively contribute to the local character through meticulously considered design and an interaction with the surroundings."

The communal landscape has been designed as more than an open space between homes. Arcadia's Ben Newell and Kate Phillips said the adjoining reserve provided an opportunity to create a distinctive natural retreat for residents.

"Just as waterways carve their way through Ku-ring-gai's landscape, a raised boardwalk weaves through the reserve, connecting the homes to this tranquil oasis."

[smartcode_project:default project_id=7354 project_image_fid=374892]

Located just 300 metres from <a href="https://www.apartments.com.au/developments/gordon-nsw-2072">Gordon</a> Village and Gordon railway station, Lume offers convenient access to Sydney's CBD while placing residents close to some of the North Shore's leading schools, including Ravenswood, Pymble Ladies' College and Knox Grammar. Lane Cove National Park, Gordon Golf Club and a range of cafés and restaurants further reinforce the family-focused lifestyle on offer, with the BMW iX3 50 complementing everything from local trips around Gordon to weekend drives and city commutes.

Construction is underway with completion expected in mid-2027.

[smartcode_project_cta:default project_id=7354]

Joel Robinson

Boutique Gordon townhomes now come with a BMW iX3 50

Two apartments have sold for more than $10 million at EADE Byron Bay, setting some of the highest apartment prices ever achieved in the coastal town and underlining the growing appetite for luxury beachfront apartments in Australia's most popular coastal locations.

The $210 million project by Vitale Property Group has now secured more than $70 million in sales, led by residences that changed hands for $12.75 million and $11.75 million.

The record-breaking transactions reinforce the shift occurring in Byron Bay's premium property market, where affluent downsizers and lifestyle buyers are increasingly opting for high-end apartments over large beachfront homes.

<a href="https://www.apartments.com.au/new-apartments/eade-byron-bay-29-shirley-street-byron-bay-nsw-2481">EADE Byron Bay</a> occupies a rare 6,000 sqm absolute beachfront site on the corner of Shirley and Milton Streets overlooking Main Beach and The Wreck surf break, just 350 metres from Byron Bay's town centre.

The 25-residence development is the first beachfront apartment project approved in Byron Bay in more than a decade and is currently under construction, with completion expected in May 2027.

[smartcode_project:default project_id=145590 project_image_fid=359521]

The project has attracted a mix of local Byron Shire residents downsizing from larger homes, alongside interstate buyers from Sydney, Melbourne and Brisbane seeking a permanent coastal lifestyle without compromising on space.

Designed by <a href="https://www.apartments.com.au/architects/hayball">Hayball</a> and with interiors by <a href="https://www.apartments.com.au/interior-designers/alexander-co">Alexander &amp; Co</a>, EADE comprises&nbsp;10 garden apartments ranging from 284 sqm to 622 sqm, nine with private pools, five full-floor apartments and 10 rooftop residences with private plunge pools, expansive outdoor entertaining areas and uninterrupted ocean views.

[smartcode_project:default project_id=145590 project_image_fid=359527]

<a href="https://www.apartments.com.au/developers/vitale-property-group">Vitale Property Group</a> Managing Partner Chris Vitale said the project's combination of scale, location and limited future supply was driving buyer demand.

"There isn't another beachfront holding in Byron Bay of this size and position that could be developed again," Vitale said.

"Buyers are responding to the scarcity and the irreplaceability of a site of this calibre and to floorplans they can't find elsewhere in the market.

"We are seeing buyers place significant value on quality, space, design, resort-style amenities and the rarity of the location. The sales achieved to date demonstrate that discerning purchasers recognise the long-term significance of what is being created at EADE Byron Bay.

"Many are coming from larger homes in the Byron region, or from Sydney, Melbourne and Brisbane, and are after the space, security and convenience, without the upkeep of a house."

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[smartcode_project:default project_id=145590 project_image_fid=359523]

The Byron Bay project follows Vitale Property Group's delivery of the Mondrian Hotel and Private Residences at Burleigh Heads, with EADE continuing the developer's focus on luxury coastal developments.

Residents will have access to a resort-style swimming pool, gymnasium, sauna, cold plunge pool, concierge services and dedicated workspaces, while the project is targeting an 8-Star Green Star rating.

EADE Byron Bay is being exclusively marketed by Projx Australia in conjunction with WHITEFOX Projects.

WHITEFOX National Projects Director Phillip Rand said demand had been driven predominantly by owner-occupiers.

"We are seeing buyers at EADE place significant value on quality, space, design, resort-style amenities and the rarity of this location," Rand says.

"The sales achieved to date demonstrate that purchasers at this level recognise the long-term significance of what is being created at EADE Byron Bay."

Residences at EADE Byron Bay are currently priced between $4.75 million and $15.95 million.

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[smartcode_project_cta:default project_id=145590]

Vitale breaks Byron Bay records with EADE sales flurry 

When buying an apartment, most people compare the big-ticket items first. Floorplans. Kitchens. Balcony size. Natural light. The view.

But there's one everyday consideration that often doesn't come up until after moving in: how parcels are delivered.

As online shopping has become part of everyday life, parcel deliveries have shifted from an occasional event to a regular occurrence. Australians spent a record $82.6 billion shopping online in 2025, with almost one in every four retail dollars now spent digitally.

For apartment residents, that can present a challenge.

If nobody is home to accept a delivery, parcels may be redirected to a nearby Post Office, left in a building lobby or common area, or require building management to step in. In higher-density buildings, where dozens or even hundreds of residents may receive deliveries each day, parcel management has become an increasingly important part of everyday living.

That can create a range of frustrations. A missed delivery often means making time to collect a parcel elsewhere, while packages left unattended in foyers or mail areas can create clutter and increase the risk of theft. What seems like a minor inconvenience can quickly become a recurring issue for residents who shop online regularly.

It's one of those details that rarely features in a display suite but can have a noticeable impact once residents move in.

As a result, buyers are beginning to look beyond traditional apartment features and consider how a building supports day-to-day convenience, including whether there are secure options for receiving deliveries.

Australia Post's Parcel Lockers provide one solution.

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Rather than having a parcel delivered directly to an apartment, eligible deliveries can be sent to a nominated Parcel Locker. Once the parcel arrives, residents receive a notification through the AusPost app or SMS and can collect it using a QR code or one-time PIN at a time that suits them.

The Parcel Locker network now includes more than 1,500 locations nationwide, with installations at Post Offices, shopping centres, transport hubs and an increasing number of residential developments. By providing a secure collection point, Parcel Lockers help reduce missed deliveries and avoid parcels being left unattended in common areas.

For developers, parcel infrastructure is becoming another way to improve the resident experience. Rather than relying on concierge staff or leaving parcels in communal spaces, secure collection points help streamline deliveries while preserving the presentation and functionality of shared areas.

For buyers, it's a reminder that the best apartment features aren't always the most obvious.

A generous floorplan or quality finishes might help narrow the shortlist, but the conveniences that simplify everyday life, whether that's EV charging, secure bike storage or reliable parcel delivery, often become the features residents appreciate most once they're living there.

The apartment feature many buyers don't think about, until their first missed delivery

<a href="https://www.apartments.com.au/developers/hg-developments">HG Developments</a> is doubling down on Maud Street in Newstead, filing plans for a new apartment tower just a few doors down from its under-construction Aire Newstead development.

Recently submitted to Brisbane City Council, the proposal is for an 18-storey building designed by bureau^proberts, which has drawn heavily on Brisbane's subtropical design principles while referencing the suburb's industrial heritage.

A total of 64 apartments are planned for the amalgamated 1,518 sqm site at <a href="https://www.apartments.com.au/new-apartments/17-21-maud-street-newstead-qld-4006">17–21 Maud Street</a>, a short walk from the Brisbane River and Newstead Riverwalk.

<img alt="First look: HG Developments plans 18-storey subtropical apartment tower for Newstead" data-entity-type="file" data-entity-uuid="a400c7fd-bd15-48f8-a63b-10ede92efe00" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Maud%20st%20bldg.png?VersionId=.0vPmjpbC7CNP7kqGWa6L7rGIwsNExaw" />

"The building is defined by a series of vaulted motifs that reinterpret the arches, colonnades and layered facades evident throughout Newstead's historic built fabric," the Urban Design Report states.

"Combined with recessed glazing and generous balconies, these elements create a layered building envelope that provides shade, weather protection and opportunities for natural ventilation whilst establishing a distinctive architectural identity."

The proposal comprises 64 two, three and four-bedroom apartments across 18 residential levels, positioning it alongside a growing number of taller residential projects transforming Newstead's northern precinct. The tower incorporates extensive subtropical landscaping, with cascading planter boxes, deep planting at street level and a landscaped rooftop recreation area.

<img alt="First look: HG Developments plans 18-storey subtropical apartment tower for Newstead" data-entity-type="file" data-entity-uuid="1d8140f4-8b98-45cd-b1b8-1efe8c8e266b" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Maud%20st%20podium.png?VersionId=VAZtbCoD44YCJ57N99fQCAKeSJx7ldZs" />

Bureau Proberts has prioritised passive environmental design throughout the project, with generous balconies, recessed glazing and operable façades helping reduce solar heat gain while maximising natural ventilation. River views become available from the upper levels, while the building has been orientated to capture prevailing breezes from both the Brisbane River and the west.

The architects say landscape is intended to be integral to the building rather than an applied element.

"Vertical greenery, cascading planter boxes and elevated gardens are woven throughout the architecture, softening the built form and strengthening the connection between residents and the subtropical environment."

"Through the integration of landscape, high-quality materials and passive design principles, the development delivers a refined residential address that celebrates Newstead's heritage character while contributing positively to Brisbane's evolving subtropical identity."

Newstead has remained one of Brisbane's most active apartment markets in recent years, with a number of developers continuing to back the inner-city suburb.

HG Developments is currently delivering the 40-apartment Aire Newstead at 25 Maud Street. Fortis recently launched the 65-apartment <a href="https://www.apartments.com.au/new-apartments/crest-walker-newstead-12-kyabra-street-newstead-qld-4006">Crest &amp; Walker</a> on Kyabra Street, while builder-developer BPG and Don O'Rorke's Consolidated Properties are both expected to launch their respective Newstead projects before the end of the year.

HG Developments doubles down in Newstead with second Maud Street apartment development

Walk past a new apartment development promoting its sustainability credentials and it's easy to picture rooftop gardens, mature trees, landscaped courtyards and residents surrounded by nature.

But in many cases, that's not actually what those sustainability ratings guarantee.

Australia's leading environmental rating tools have played a significant role in improving the energy efficiency and environmental performance of buildings. Yet despite their focus on reducing emissions, many don't require developers to include trees, biodiversity or meaningful green space.

In other words, a building can achieve one of the country's highest sustainability ratings while containing little more than concrete, glass and hard landscaping.

That disconnect has led to the emergence of a new movement across Australia's property industry: nature-based cities.

The concept goes beyond designing buildings that consume less energy. Instead, it encourages developers to treat nature as essential infrastructure, integrating biodiversity, tree canopy, living landscapes and green spaces into projects from the earliest stages of planning.

Research has consistently linked access to nature with better physical and mental health, cooler neighbourhoods, improved biodiversity, stronger climate resilience and more connected communities. As Australia's cities continue to become denser, advocates say those outcomes should be considered just as important as energy efficiency.

Nature Based Cities (NBC) was established in 2022 to help accelerate that shift.

Founded by Hamton Executive Chairman Paul Hameister OAM, the not-for-profit was created after research highlighted a significant gap in Australia's sustainability framework. While existing environmental rating tools rewarded energy performance and emissions reductions, they placed little emphasis on the inclusion of living landscapes.

"We've always wanted to do more, and we know other developers who want to do more, but the ESD rating tools just aren't there," Hameister says.

"In Australia, you can have a five-green-star rated building that's concrete and glass with not a blade of grass.

"The focus is on reducing emissions, which is laudable, but there hasn't been enough attention paid to protecting and re-establishing nature. We need both for the health of the environment and for communities."

Since its launch, NBC has developed independent design guidelines and accreditation frameworks that encourage developers to prioritise ecology, biodiversity, tree canopy, walkability and living landscapes alongside traditional sustainability measures. The organisation first focused on medium and high-density residential developments before recently expanding into precinct-scale communities and masterplanned neighbourhoods.

Jan Talacko, founder of sustainability consultancy Ark Resources and a member of the Nature Based Cities Advisory Council, says the initiative addresses an area that has largely been overlooked by the property industry.

"Throughout my 25 years of working collaboratively with all stakeholders in the property sector, I've always favoured a pragmatic approach to sustainable design which encourages initiatives that not only meet environmental expectations but also improve amenity," Talacko says.

"Whilst we are making steady progress in relation to energy and carbon emissions from buildings, there has been much less emphasis on encouraging biodiversity and tackling the urban heat island effect.

"The Nature Based Cities initiative responds to a gap in the suite of tools currently used by the property development sector, which don't provide sufficient incentive, or recognition, for the integration of landscaping and greenery."

For apartment buyers, the shift is also changing the questions worth asking.

Rather than assuming a sustainable building will naturally include abundant green space, buyers are increasingly being encouraged to look beyond environmental ratings and ask what nature is actually being delivered. How much tree canopy will the development create? Has biodiversity been considered? Are landscaped spaces designed for people as well as appearance?

As Australia's cities continue to grow upwards and outwards, the next generation of sustainability may not simply be measured by lower emissions, but by how successfully developments bring nature back into everyday urban life.

Michael Yardney

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