It's been long said that property is the best investment. And despite dips in the global economy, that remains (mostly) true.
But things move fast in the Australian property market. If you want to be successful, you're going to stay on top of the trends.
In this article, we're taking a look at where the market is headed in 2018 and how you can stay ahead of the curve.
Playing it Safe
There's nothing the market dislikes more than uncertainty.
And with the temperature of the global climate, there's a lot of uncertainty these days.
The global market is still reeling from the results of the Brexit vote and the election of Donald Trump in the United States. With the volatility between Trump and China and Trump and North Korea, tensions all around are high.
Australia may be an island, but we are still affected by the Chinese and American markets. Political unpredictability--or a trade war--will harm those markets, and we'll feel it in Oz.
As such, this economic uncertainty will likely cause many would-be investors to keep their money in their pockets, slowing growth in the Australian property market.
The Future of Chinese Investment
While Chinese investors have had a large share in the Australian property market over the last decade, experts warn that that might be reaching a breaking point.
Despite expectations that 2017 would see even more money from Chinese investors, that hasn't been the case. In fact, in the first two quarters, Chinese investment was down 9.7% compared to 2016.
This comes on the heels of new regulations on Chinese companies which threaten to limit corporate investment overseas.
At the same time, while Chinese investment was cooling, inquiries into the Australian property market grew in other Asian nations. Specifically, Thailand, Japan, and Malaysia.
A Safe Haven
But shifts in global politics aren't all doom and gloom.
With uncertainty plaguing the UK, USA, and much of Asia, Oz is looking like a safe option to global investors.
With a booming property sector, political sovereignty, and steady economic growth, Australia is an attractive choice for international investors looking for a place to grow their dividends.
As political uncertainty continues to grow throughout the rest of the world, Australia will continue to look like a safe bet.
The Woes of the Brick and Mortar
Compared to the rest of the world, Aussies have been slow to adopt online shopping. As such, brick and mortar stores and shopping centres have been safe, while they have been closing in droves overseas.
But that might be changing.
Amazon has left a trail of empty box stores in its wake in America. And now, it has its sights set on Australia.
Amazon has been planning their Australian invasion for quite some time. Now, it anticipates making landfall as early as October 2017.
It's unclear whether Australian shoppers will move their money to online shopping as quickly as the rest of the world. But one thing is certain: retailers are going to have to adapt to survive.
Say Hello to Technology
While technology is changing the way we shop, it's also changing the way business is done.
There are a number of growing tech companies in Australia, and more are starting every day. As retailers lose out to online sellers and offices include more and more remote workers, tech companies will come to occupy those spaces.
This will drive office properties up after years of lacklustre performance.
As manufacturing and agriculture continue their dependence on automation, technology will change their needs for property.
Factories will likely downsize to accommodate fewer workers. Farmers will be able to cultivate larger tracts of land than before.
A Flooded Residential Australian Property Market
Real estate development has been having quite the time lately.
Low-interest rates and offshore investment saw unprecedented growth in 2015 and 2016. But now, developers are facing a problem.
There isn't enough demand to meet the existing supply.
Melbourne and Brisbane especially are seeing an oversupply of residential spaces. This will see values of homes and apartments in these cities drop, which is bad news for investors.
But as prices drop and these homes become more affordable, we will see movement to these cities, which will give opportunity to developers to build non-residential projects.
Residential development is sure to slow in these areas until the existing units can be occupied.
Meanwhile, there is tremendous opportunity in Sydney as demand for housing remains high.
The Sharing Economy
Thanks to sites like Airbnb and Flatmates, many people are making a decent living subletting their homes on a short-term basis.
These sorts of accommodation-sharing sites are in high demand among travellers looking for an authentic experience abroad.
Some people can only manage to rent a spare bedroom. Others rent on weekends and make arrangements to stay at a friend's.
But for some people, Airbnb is a full-time gig. They might own a property that they use exclusively for short-term rentals. This is often called "rent-vesting."
With the residential sector of the Australian property market becoming more affordable, we are sure to see an increase in would-be landlords capitalising on it.
Looking to Invest in the Australian Property Market?
If you're interested in investing in the Australian property market, you're not alone.
A steady trend of domestic economic growth and healthy offshore investing will continue to keep Australia's status as a good place for investment.
Need more information? You've come to the right place.
Whether you are a full-time property investor or just looking to build some passive income, Axon Property Group is here to help you make your financial dreams a reality.
Get in touch with us today. We'd love to put you on the path to success!