While global investors reel from a series of sharp stock market around the world, real estate markets in many parts of the world are continuing to see strong growth.
Take Sydney as one example, where Angus Raine, Executive Chairman of real estate firm Raine & Horne. Noted that in south-western parts of the city its St Marys office posted a record sales month in December 2015 – achieving a 5 percent increase in sales revenues compared to the final month of 2014.
“This result bucks the doom and gloom about Sydney real estate and demonstrates that there is still demand for quality bricks and mortar in many pockets across the city,” said Raine.
“The market might not achieve the double digit returns of the past three years; however, many Sydney real estate markets will achieve capital growth by the end of 2016.
“Many of the same fundamentals remain in play, such as Sydney’s continued population growth, as well as our strong economy, improved employment figures, and low interest rates. Around 50,000 people move to Sydney annually and they all need somewhere to live, while there is a good chance we’ll see more rates cuts in the middle of the year.”
Share markets have seen sharp declines so far in 2016, with U.S. equities down by 5.2 percent, Eurozone shares dropping by 6.2 percent and Japanese shares falling 9.5 percent, according to research from AMP Capital Investors. More significantly, Chinese shares have plummeted 14.6 percent while the Australian market is down by 6.8 percent.
“The crashing share market is helping attract plenty of investors to our region who are looking for a safer haven to park some money, while also enjoying relatively strong yields of 5 percent,” said Peter Diamantidis, Sales Manager, Raine & Horne St Marys.
“Properties that had been sitting on the market for three months were snapped up in December, which means we now have a shortage of listings,” Diamantidis said.