The media is currently packed with real estate ‘doom and gloom’ – real property repossessions and arrears are up and real house prices are down… the almost as if the ‘sky is around to fall’! This situation has seen many real estate designers, and property investors generally, leave the market – and for those thinking of beginning real property development, they are scary times indeed. appraisalsonly.com
What seems like the worst time for you to get into real estate development can, in reality, be local plumber. Successful real house developers today realize that they can use the perfect time to their advantage – their real estate development jobs will typically not be equipped for sale or rent for 2 to 4 years from inception. So if they have bought well, they may be less likely to be damaged by the economical situation at the time of purchasing their real estate development site.
Actually a weak market is a property developer’s paradise, because a fragile market is a bidder’s market, and one of the first steps to any real estate development project is securing a viable real estate development site on the best possible terms.
Although we can say that the real estate development business is cyclical, and many regions of the world are in a house downward spiral, we also know from history that knowledgeable real estate developers are successful in any market – falling, flat or growing.
We’re working towards what we should believe the economical conditions will be in doze to 36 months time. Indeed we ourselves are still active in the market – seeking Authorities permission for a quantity of real estate development projects. This gives all of us the possibility to act quickly and build our approved real estate development jobs when the market will become buoyant.
It is our view that the following market signals are some of the key factors that will lead to increased future opportunities, specifically for real estate builders:
? The pent up demand for housing. In Mar 2008 leading Australian economics forecaster, BIS Shrapnel main economist Dr Frank Gelber argued that housing prices across Australia will surge by 30% to forty percent over the next five years due to built-up disadvantages of housing.
? The current Government has explained that they will work at increasing Housing Affordability and possess begun to announce bonuses including Tax Credits of $6000 per year if the housing is booked at 20% below market rent.
? We assume that progressively more people, in the brief to medium term, will probably require the rental accommodation that we intend to build. Due to the fact either their financial stress (can’t manage to acquire a home) and demographic trends (including Gen-Ys who are much less likely to buy Genuine Estate).
Even if our ‘crystal ball’ is wrong, we know we now have the resources to hold real estate development sites during possible further market variances to come, and increasing rents are certainly assisting get back!
Our belief is that this is a golden time to action – perhaps an once in a generation opportunity. Maybe it is not the time to sell completed real estate development projects at the second, but that is definitely a great possibility to secure the development site and obtain development planning endorsement. Now this strategy is not for everyone – you must have the necessary resources to support the development site and especially the ability of real real estate development to take good thing about these opportunities.