A survey of 31 firms, including the major banks, by the Australian Property Institute (API) found that they believe residential property in Sydney has more growth potential than any other class of property on Australia's east coast. As we are overweight in Sydney residential property this would be good news for us. API New South Wales president Tom Webster warned that the Sydney market is "very segmented". "There are large chunks of the Sydney property market that won't go up, but there are other parts, more at the higher end, that will." Fortunately I sold my investment house in Sydney's poorer Western suburbs region back in the 1990's and our house and current investment property are in one of the more "up market" regions of Sydney, so we stand to gain from any rise in the upper end of the Sydeny real estate market.
Since 2003 most of the increase in my net worth has come from the strong rise of the Australian stock market and from my savings plan, while the property in our portfolio has been stagnant since the Sydney real estate boom ended in 2000. As we have around $1.4m worth of property with $0.7m of interest-only mortgages against them, any rise in property prices would significantly boost our net worth.
Copyright Enough Wealth 2007
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