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Returns on property rose in 2012

Happy February everyone! Here at The Successful Investor we welcome the New Year – excited to provide our expertise, advice and properties to our clients old and new. Our friends at API Magazine (Michael has been in the last two issues) recently published an article indicating that returns on residential property grew by 4% in 2012. The expectation is that this growth will not slow down. You can read the article over at Australian Property Investor and we have also included it below:

Despite a year of ups and downs and flat price growth, property has emerged as a sound investment method.

CommSec chief economist Craig James says total returns on residential property, taking into account by prices and rents, grew by four per cent in 2012.

By comparison, returns on cash investments rose by 3.7 per cent on average in 2012, James says. Both were dwarfed by average sharemarket returns, which grew by a staggering 19 per cent.

RP Data-Rismark’s Home Value Index shows capital city home prices were down 0.4 per cent for the year, indicating significant declines have slowed.

A modest rally in most major markets in the second half of the 12 months helped to recover losses in the first six months.

Cameron Kusher, RP Data senior research analyst, says capital city values remain 5.7 per cent lower than their historic highs of November 2010 but are up almost two per cent from their low of May last year.

Dwelling values are higher than a year ago in three of the eight capitals, being Darwin (up 8.9 per cent), Sydney (up 1.5 per cent) and Perth (up 0.8 per cent).

Rental growth outpaced value growth last year, with capital city dwelling rents up three per cent in 2012.

We look forward to another great year at The Successful Investor and if you’re interested in expanding or even beginning your property portfolio in 2013 you can contact us to speak with a consultant. Email us at info@thesuccessfulinvestor.com.au or call head office directly on 1300 800 886.