5 Year BOOM phase 2#

Summary

The transcript reveals a strategy used by a small percentage of Australian investors to achieve significant property growth. It emphasizes the importance of understanding the five-year boom phase in property markets, where consistent double-digit growth occurs, allowing investors to release equity and purchase additional properties. The speaker discusses the dangers of timing the market incorrectly, which can lead to significant financial losses, and offers insights on how to identify areas entering their growth phase. The transcript positions this knowledge as a key to building wealth faster than the average investor.

Takeaways

• 🏡 A small percentage (0.4%) of Australian investors are capitalizing on property investments with consistent double-digit growth.
• 📈 These investors leverage equity from one property to purchase another, aiming to build wealth 10 times faster than the average investor.
• 📊 Understanding the 'five-year boom phase' is crucial for identifying areas that are starting their growth phase at a particular time.
• 🚀 During the boom phase, there is significant double-digit growth, but it's followed by a slowdown that can lead to financial losses if timed incorrectly.
• 📍 Each market and suburb has unique growth cycles, and timing entry and exit correctly is essential for maximizing capital growth.
• 🌐 The speaker's advisory uses a 72-step process to analyze market trends and future projections to inform investment decisions.
• 🔄 The goal is to ride the wave of capital growth in one market and then move to another that is starting its growth phase.
• 🏞️ Case studies like Frankston and Gimpy demonstrate the importance of timing the market correctly to avoid stagnation or decline in property value.
• 📉 Missing the optimal investment window, such as entering the Hobart market in 2016, can result in significant missed growth opportunities.
• 💡 The speaker emphasizes the importance of informed decision-making over guessing or following the news when investing in property.

Q & A

What percentage of Australian investors are capitalizing on consistent property growth?

0.4% of Australian investors are capitalizing on consistent property growth by purchasing multiple properties within a short period of time.

What is the significance of the 'five-year boom phase' in property investment?

The 'five-year boom phase' refers to a period of consistent, double-digit growth in property value that occurs in specific areas. It is significant because it allows investors to capitalize on this growth, release equity, and use it to purchase additional properties.

How often does the 20-year growth cycle occur in a particular Local Government Area (LGA)?

The 20-year growth cycle, which consists of two boom phases, occurs every 15 to 20 years in a particular LGA.

What happens after the five-year boom phase in a property market?

After the five-year boom phase, there is typically a slowdown in the property market. This slowdown can involve the market trending sideways or downwards, which can be detrimental to investors who enter the market during this period.

Why is it important to time the market correctly in property investment?

Timing the market correctly is crucial because it allows investors to ride the wave of capital growth and maximize their returns. Entering the market at the right time ensures that investors can release equity and use it to invest in other markets that are starting their growth phase.

What is the impact of entering the market during the slowdown phase after the boom period?

Entering the market during the slowdown phase can cost investors hundreds of thousands of dollars as they may not see the capital growth needed to release equity and reinvest in other properties or personal goods.

How can investors identify areas that are starting their growth phase?

Investors can identify areas starting their growth phase through in-depth research, historical trends, and analysis of government policies and infrastructure projects. Tools like the 72-step process mentioned in the script can help investors make informed decisions.

What was the observed capital growth trend in the Frankston region from 2013 to 2017?

The Frankston region experienced significant capital growth from 2013 to 2017, with some individual suburbs in the area seeing over 10% capital growth.

What happened to the property market in Gimpy, north of Brisbane, from 2012 to 2019?

Gimpy experienced a trendless period from 2012 to 2019, with no significant growth. However, it began a boom phase, showing a massive spur in growth due to government policies and infrastructure projects.

What was the capital growth situation in Hobart from 2012 to 2018?

Hobart saw consistent double-digit growth from 2012 to 2017, with some suburbs experiencing growth of up to 155%. However, from 2018 to 2020, the market did not see any significant growth.

How can investors avoid making uninformed decisions in property markets?

Investors can avoid uninformed decisions by conducting thorough research, understanding market cycles, and using tools and processes like the 72-step process to make informed decisions based on historical trends and current market influences.