This never ceases to amaze me.
There are always new ways to make money in property.
This is one of the things that I hear from my students all the time. “I would have got into property earlier, but I felt like I had missed the boat. The market had moved on.”
“The opportunities to make money in property have all gone.”
This is never true. There are always ways to make money. There are always opportunities. It’s actually what makes property such a unique asset class.
I think part of the misconception comes from the fact that most people think purely in terms of a buy and hold strategy. Buy something, do nothing, wait for the market to go up, make money.”
This is ‘a’ way to make money in property. But is probably not the best way, and it’s a strategy my students almost never rely on entirely.
Because there are just so many things you can do.
Take this recent story from Domain for example. They reckon that properties with ‘green’ features are worth 53% more than other comparable properties:
Home buyers are willing to pay up to 53 per cent more for sustainable houses than traditional properties in some suburbs across the country as energy-efficient features become a necessity rather than an option amid escalating costs of running a home, a new report from Domain shows.
Properties with eco-friendly attributes such as solar and double glazing are also selling 4 per cent faster on average and are attracting 17 per cent more buyer interest.
Nicola Powell, Domain’s chief of research and economics, said buyers were becoming more climate and budget conscious and were willing to pay a premium for energy-efficient features.
“Listings that include terms associated with sustainability and energy efficiency are fetching higher prices compared to those that don’t, so there’s clear demand for green homes,” she said.
“Buyers are recognising that features like cross-ventilation, north-facing orientation, heat recovery ventilation, and solar panels not only contribute to environmental sustainability but also offer practical advantages, such as reducing the costs of running a home.”
Melbourne attracted the highest price premiums on average of all the capital cities with sustainable houses fetching 28.8 per cent more or an extra $241,750 compared to non-sustainable homes.
In Sydney, sustainable houses commanded a 23.1 per cent premium or an additional $330,250 on average, while eco-friendly houses in other capitals collected more than 10 per cent.
And so suddenly there’s a new way to make money in property. If you can add these ‘green’ features profitable rate (anything below $330,000 in Sydney apparently!) then you can make money.
Green flipping properties is the new investment strategy in town.
But this strategy simply didn’t exist 10 years ago. Even five years ago.
And this is the thing. The market is always changing. I’ve been watching the market for a long time, and it never ceases to amaze me that people still keep coming up with new ways to make money out of property.
There really is no asset class like it.
DB