I do not know if I have this right looking to buy again I do have report on a state can anybody explain how to read the growth cycles properly .
I am trying to alleviate buying in an area that is not going to have growth10 y 5 y 4y 3y 2 y 1 y
6.02% -1.7% 1.64% 4.25% -0.03% 1.61%8.40% 8.49% 4.06% -2.72% -0.82% 7.89%
6.02% 6.3% 7.2% -3.2% -2.4% -0.4%
6.0% 5.69% 9.65% -3.4% -3.6% -3.2%
6.1% 5.8% 4.2% 4.1% 3.6% 5.6%
Do you buy if the growth has been ok and then it may lose a bit would that mean it is on the rise or do you buy where it is steady all the time
It would be great if I knew how to read the report or is there a book out there All help is appreciated
Hi Lulu1,
I'm assuming these figures are CG of certain areas for the past 10 yrs? If so, I've crunched the numbers in Excel, what
you should be looking at is to invest in areas that have at least an average of 8% of CG or above over the 10 yr period.
I wouldn't invest in any of these areas because the highest CG you get is only 5% because you won't get back
your deposit within 18 months to refinance to fund for deposit for 2nd after purchased due to poor CG; Consider only investing in areas where the 10yr average of CG is 8% or above:
10 y 5 y 4y 3y 2 y 1 y Avg
6.02% -1.7% 1.64% 4.25% -0.03% 1.61% 2%8.40% 8.49% 4.06% -2.72% -0.82% 7.89% 4%
6.02% 6.3% 7.2% -3.2% -2.4% -0.4% 2%
6.0% 5.69% 9.65% -3.4% -3.6% -3.2% 2%
6.1% 5.8% 4.2% 4.1% 3.6% 5.6% 5%
What's important about CG? Without it, you cannot build your asset based hence your IP don't grow. If you desires to build your portfolio, CG will help you achieve this.
Good luck
Cheers Leo
Understanding growth isn’t easy – 10 year growth rates are a great start/ Use the CG chart that you provided to find a suburb that has had decent 10 year growth, then look at the reason why it has had that growth. Don’t discount suburbs that don’t meet the 10% though,
Consider this: perhaps a suburb has had excellent growth in the past 9 years, and then in the 10th year had a massive decline. That decline could signal that there are fantastic deals available in that suburb. So in this case you would investigate the reason for the decline. Perhaps it is a once off issue that has occurred, and perhaps dozens of properties in the area are undervalued because of it.Overall I must agree with Leo – growth is important. But you need to tie it into your investment strategy and work out your long term goals.
Good luck!
Hi DHCP,
Could I have a copy of that excel spreadsheet that you mentioned with CG ?
Thanks karlm63
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