The uncomfortable truth about Australian property
Most Australians are taught that any property will make a good investment. The data tells a different story.
Research consistently shows that the vast majority of residential properties underperform the market average over a 10-20 year holding period. A small minority perhaps 5% do almost all of the heavy lifting.
Never guess. Never speculate. Always investigate.
What separates the 5%?
Investment-grade property shares a handful of characteristics that the rest of the market lacks:
- Scarcity land or dwellings that cannot be easily replicated
- Owner-occupier appeal the type of home people aspire to live in, not just rent
- Strong infrastructure investment public and private spending that lifts the location
- Demographic tailwinds population growth and household formation
- Restricted supply limited new stock coming online
The IGP Investment Index
Every property I assess is measured against more than 50 independent investment criteria before it is ever considered investment grade. The Index removes emotion from the decision and replaces it with evidence.
If a property doesn't satisfy the standards of the Index, it simply doesn't make the shortlist.
The takeaway
Successful investing doesn't come from buying the cheapest property or timing the market perfectly. It comes from consistently acquiring exceptional assets with the fundamentals to outperform over the long term.
Andrew
Director, Investment Grade Property
