In putting the show together for this week, I asked Michael Yardney if he could detail what he thinks are going to be the property “hotspots” in 2016. Those who work with Michael, will know his response to that question. Not quite what I expected and you might be surprised as well.

Cate Bakos gives us her 4 essentials for investment selection and why we ask the wrong questions and Damian Collins looks at what’s ahead for Perth property.

The recent wave in the Sydney market is one that every investor would love to have known about before it happened but that isn’t the only place in Australia where gains are happening. Tony Coughran points out the areas on Queensland’s Gold Coast he thinks will boom next.

The tiny house movement originated in the United States in the late 1990s. Typically these small homes aren’t larger than 46 square meters with some as small as 11 and half square meters. That is smaller than most master bedrooms. The movement has since spread to New Zealand, Canada and Australia and today we talk to someone who has built one and is getting so many demands to build more she is starting a business building them.

Further to that, I talk to KPMG Demographer and social commentator Bernard Salt about this tiny house movement and the future of Australian housing.

 
Transcripts:
Damian Collins
Kevin:  As we look around Australia, it’s just so interesting to watch all the different markets, and we’ve seen a bit of a topsy-turvy market in Western Australia, specifically Perth, in recent times. Let’s head that way now and get a bit of an insight as to what’s happening in that Perth market. If you’re an investor there, you’re going to be hanging off the words of Damian Collins from Momentum Wealth in WA.

Damian, thank you for your time.

Damian:  Pleasure, Kevin.

Kevin:  Would it be too rude to say that Perth is a bit of a cot case?

Damian:  I think that’s on the harsher side, Kevin. Look, it’s definitely a market that’s had a pretty average year. You’ve found that the rental vacancies have gone up and prices have come back. Depending on the properties in the areas, some areas have actually flat-lined and even marginally gone up, but a lot of areas have come back 5%, and you get some of the more extreme areas that have come back between that 5% and 10%.

It’s certainly been an impact of two things. Obviously, the mining downturn has meant fewer people coming into Perth. We haven’t seen a huge amount of people leaving. There have been some, but by and large, it’s just been less of an influx.

What’s caused the biggest issue for the over-supply is the government threw a lot of money at first-home buyers and we had record building over the last 12 to 18 months and that’s what’s caused, I guess, a lot of extra supply in the market and also caused the rental vacancy rates to rise with first-home buyers taking advantage of all the free money from the government and going and building new homes.

Kevin:  I was in Perth not too long ago, and I noticed a lot of work happening down on the foreshore there. There was a fairly big development. I just can’t recall the name of it, but I understood that there are a lot of units being built in there, as well, Damian.

Damian:  That might have been Elizabeth Quay, Kevin, right on the water in the city.

Kevin:  That’s the one.

Damian:  There are a lot of units planned for there. There’s a hotel. Also Chevron is going to build an office down there, albeit that’s been put back for a couple of years.

What you’ll find with a lot of the inner city apartment supply is that because the market’s a bit softer, it’s not all going to get off the ground. It’s all very well to advertise and promote it, but if you don’t get the pre-sales, the banks generally won’t fund that project.

There is a bit of development happening, and Perth certainly is a good 15 to 20 years behind Sydney and Melbourne in terms of