The Australian love for property and the Australian dream of home ownership are quite unique, but what’s the reasoning behind that love? Experts weigh in on this, as well as what’s happening to the beloved Australian dream.
Loving property should be one priority of an investor, but aside from the monetary gain, have you stopped and thought about why?
Anthony Millet, CEO of fractional investment company BRICKX and originally from the UK, revealed what he has observed looking into the Australian market.
“From an actual asset class, property is the one that you kind of fundamentally need. It's got more use to you than shares...you can live in it,” he said, speaking at a panel hosted by financial planner Fox & Hare Financial Advice.
“It's also the best forced savings asset that you guys can have, because once you're in, it just...forces you to save.”
He also looked at how the Australian dream, the perception of becoming a homeowner, stands out from the perception of property compared to other European nations.
“The Australian dream is quite unique for Australia compared to a lot of other places in the world,” Mr Millet said.
“In Germany, people don't often own their homes until they're 60 or 70, they actually rent for the majority of their life. In the UK, we definitely don't have the kind of level of obsession with property as here, so I think it's something that's quite cultural.
“You've seen some really fantastic performance in property, especially over the last 25 years where you haven't really seen any kind of economic recession or downturn in Australia.”
The performance of popularity, in particular, is something that Glen Hare, co-founder of Fox & Hare Financial Advice, noted plays a role between generations, from parents to children.
“Our parents have probably had a lot to play in this. A lot of clients come to us, and it's their parents that have told them that property is the right investment for them, and they've also probably seen their parents do really, really well, particularly if they've invested in Sydney,” Mr Hare said.
The Australian dream, however, is in a state of flux. According to Kellie Landrey, a buyer’s agent at Scoutable, he believes that dream moving away from suburbia and is moving on up, literally.
“We're going vertical, really. We're not the acre block anymore..., we're going smaller and we're going up,” Ms Landrey said.
“I think 300 metres of any station is being marked for high rise development across the 20 kilometre radius of the city.”
Mr Millet agreed, also pointing out an increase of infrastructure expenditure to facilitate regional areas.
“I think you'll see these regional areas will now really start to explode as well, because if you look at Melbourne CBD, Sydney CBD, etc., they're already very very over, overdeveloped, there's not much more that can be done there, people are having to reconsider and move out,” he said.
As an example, Mr Hare has noticed the rising number of more regional areas using enhanced infrastructure to make their way into major cities.
Young families are buying on the Central Coast and living on the Central Coast and making that commute is becoming more and more common,” Mr Hare said.