22 Jun More softening on the way + Sydney is historically the worst growth city + ‘Knock-overs’ grow
Highlights from this week:
- The next suburbs to gentrify
- SQM tip a slowing market
- The factors to consider when comparing houses and units
- Real estate is all about the land – here is proof!
- We plot the double digit price growth in our capital cities
We plot the double digit price growth in our capital cities – Simon Pressley
Kevin: Gee, haven’t we seen some tremendous price growth in the capital cities in recent times? It makes me wonder how often we’ve seen double-digit price growth in the cap cities around Australia. So, that’s the question we posed. We’ve asked Simon Pressley that question from Propertyology.
Simon, welcome back to the show. Good to have your company again, Simon.
Simon: Thanks, Kevin. Yes, always good to talk about these things.
Kevin: Simon, how many times since the turn of the century has each capital city produced that double-digit price growth?
Simon: It’s different in every city, but the record-holder for the number of calendar years over the last 18 years that double-digit price growth has been achieved – it’s a surprise, people – is Darwin.
Darwin has had more double-digit price growth years in 18 years than anywhere else. It’s had 11 out of 18 years of double-digit price growth, which is one of the reasons why we like to do these historical studies from time to time, because Darwin, as we all know, over the last three years, now probably into its fourth year, has been in price decline.
Sometimes looking at history can be a good reminder that things are never as good as they seem nor are they as bad as they might seem at the time.
Kevin: Talking about timing, how do you compare performance, say, pre- and post-GFC?
Simon: Certainly, pre-GFC Australian property markets right across the board, eight out of eight capital cities, pretty much every regional location produced some spectacular growth. Let me give some examples.
The year 2000, the turn of the century, to the end of 2008, which we all recall was the onset of the GFC, that nine-year period of time, Brisbane’s median dwelling price increased by 203%. 203% in nine years.
Simon: Perth increased by 245%. Canberra and Adelaide were pretty close in third place, 186%. Actually, Hobart was ahead of them, 205% growth in nine years. The worst-performing capital city – I use the term “worst” lightly – Sydney, that nine-year period, prices grew by 93% in nine years, which is still spectacular growth but it was easily the worst growth.
And then post-GFC, well, for a few years there, Darwin did again strong for a few years there. Perth had a strong year in 2013, but it’s predominantly been a story of Sydney and Melbourne post-GFC to date, although they’re in decline now, and Hobart more recently.
Kevin: What are some of the biggest years of price growth?
Simon: It’s fascinating when you look at what’s been achieved before. Here are some stats for you. Hobart in 2003, 44% price growth in a calendar year and then the following year, 32%. So, property almost doubled probably in two and a half years in that period of time. But it’s not unique to Hobart. Brisbane’s strongest year of growth, 36% in 2003. Do you remember that, Kevin?
Kevin: Wow, that is amazing. It is interesting to look back because we do forget this, don’t we?
Another question for you – you may or may not be able to answer this one – which city holds the record for the most consecutive years of double-digit growth?
Simon: Yes, it’s Darwin again. Nine years in a row of double-digit price growth, so 2002 through to 2010 inclusive, double-digit price growth. Phenomenal. Now, I can’t see anything on the immediate horizon for Darwin, but it has its own economic assets as every location does, and there will be time in the sun again for Darwin at some stage in the future.
Sydney and Melbourne had eight years of double-digit price growth over the last 18 years, which is the second most after Darwin. Brisbane and Hobart had only four, but that said, it’s probably proven to be more consistent than some of the other big capital cities.
Years of decline, to keep this discussion balanced, every market has years of decline. Darwin has had the most, five out of 18 years, and Perth, sorry, six out of 18 years. That could imply boom-and-bust markets, when they have lots of years of double digit price growth and also the most years of decline. But the actual closer analysis of the data doesn’t suggest boom and bust, certainly some big booms, but the years where there have been decline, we’re talking single-digit declines. And Sydney and Melbourne are experiencing that now, aren’t they?
Kevin: Yes, they are.
Simon, when was the last time that a capital city produced 20% price growth in a calendar year?
Simon: Again, Darwin: 22% price growth in 2007, so we’re going back ten years ago. I actually think the closest candidate to break that record – time will tell; there are seven months ago in the calendar year – Hobart. If anyone’s going to break it, it’s on track. It’s a big call to say it will get 20%. I’m not saying it will. But the metrics we look at, we know it’s already had two really strong years and growth seems to be accelerating.
Out of Hobart, not a chance at 20%. What I call metro Hobart – a seven- to eight-kilometer ring of the CBD. As I said, if anyone is going to break 20% in a calendar year, it’s Hobart in 2018.
Kevin: At the other end of the spectrum, how often do property prices decline in a calendar year?
Simon: They don’t decline that often. As I said, Darwin has declined five times in 18 years, and Perth, six times. Canberra has only produced price declines in one calendar year in 18 years, and five other capital cities have only declined twice over 18 years. But anyone who says property prices never go backwards we know is telling some porkies there.
Not that long ago, 2011, eight out of eight capital cities declined, and the following year, 2012, five out of eight capital cities declined. One of the three that didn’t decline had zero growth, and that was Sydney.
There would have been a lot of people… And sometimes investors can have short memories. Sydney was a flat market for a long, long period of time while most of Australia did really, really well. When it declined in 2011, a lot of people bowed out and said “I’ve had enough of this market.” It did nothing in 2012 and then the rest is history, what happened in the next four and a half years. They had a big boom.
So, those who are sitting on an asset now who think “I’m miserable, I shouldn’t invest,” or whatever, just have a think about what all those Sydney might have thought in 2012 and then what happened after that. Things are never as bad as what they seem, no matter what we’re reading in the media each day. We always need housing.
Kevin: Mate, can I just round this conversation out, just with probably a pretty open question, but I’m hoping you can answer it for me about the factors that influence this double-digit price growth and whether or not you think we can expect to see it any time again soon?
Simon: Look, it’s a combination of things that cause really strong price growth, which obviously includes double-digit price growth, but in no particular order, it’s when an economy improves. So, Sydney and Melbourne, the start of their boom was after coming out of several years of a very miserable economy.
If we can remember back in that era, we had I think it was a Gillard Government, we had Wayne Swan as treasurer, and we were hearing every day about this two-speed economy. The resources sector was really, really strong, so it was parts of regional Australia that were the only ones who had a healthy property market, and all the capital cities were miserable.
But when the economies started to improve and it was the service sector that saw the improvement first, then confidence was gained in those communities and markets started to rise. So, improving economies, general confidence is a flow-on effect from that.
Availability of credit: that’s probably one of the key differences between this current era and pre-GFC, when credit was a lot more readily available back then even though interest rates were twice as high then as what they are now.
And affordability: there is no coincidence here that when we look at years of double-digit price growth, that the more affordable capital cities have had much bigger years. We use Brisbane as an example, 36% in 2003; Hobart, 44% in 2004.
The more affordable capital cities have had much bigger price growth. Even though Sydney and Melbourne – the more expensive cities – have had double-digit growth, they’ve been in the teens rather than the 20s, 30s, and in some cases, 40s.
Kevin: Fascinating, mate. It’s great research, and it’s really nice to be able to bring it all together like this, so a great learning experience.
Simon Pressley from Propertyology, thank you so much for your time and that really interesting look into double-digit price growth. Thanks, mate.
Simon: My pleasure. The glass is half-full, always is.
SQM tip a slowing market – Louis Christopher
Kevin: The figures released by Louis Christopher at SQM Research show that maybe the softening of the market that we have been seeing might just continue. Louis joins us to talk about that.
Good day, Louis. How are you doing?
Louis: Good to be here, Kevin. Doing well, thank you.
Kevin: Thanks, Louis. The listings were steady in May across the country?
Louis: Yes, that is correct. Nationally, the listings stood at 325,000 rounded, which was absolutely unchanged from the previous month of April. Overall nationally, listings, when we look at the year-on-year change, was just up by 0.4%.
What is happening is that there have been some cities that have recorded a little bit of lift in the month, some cities recording a decline in the month, and regionally, when we look at, for example, the mining towns, they’re all recording falls in listings right now. So, the regionals are kind of off-setting some of the slow-down that we’ve seen in the capital cities.
Kevin: This is obviously a reflection of a lowering of consumer confidence, saying, “Well, maybe this is not the best time to put my place on the market,” Louis?
Louis: Yes and no. We did record, for example, a rise in Melbourne of 2.4%. I think what’s going on there is that some vendors are looking at the market and saying “Actually, we need to sell now if we want to try and pick the top of the market or try and get that price that we were hoping to get because the market could end up moving south from here.”
I think there are a number of vendors who are in that camp right now. They’re actually thinking, “Let’s sell now while the going is still good.”
Kevin: There have been some reports out in the last week or two about particularly investors wanting to sit on their hands and saying “This is not necessarily a good time. I think I’ll probably hold onto my property for a little bit longer.”
Do you share that sentiment, Louis?
Louis: I think that there are potential vendors who look at it that way. And maybe they’re not vendors to begin with; they’re long-term property owners who are quite happy to just see the cycle through, so they’re not really that interested sellers.
But there’s also another camp of property owners who have been looking to potentially exit out. They’re either looking to upgrade, downgrade, maybe sell out altogether, and they will be looking at the market now, particularly in Sydney and Melbourne, saying “We should sell now while we still got relatively more buyers in the market because things could actually get worse later in the year.” So, there is definitely that camp of sellers that is operating in the market right now.
Kevin: I think quite a few people have been surprised by what’s happened in Hobart – and I noticed in your report, too, the listings have fallen in Hobart, which is probably going to make that situation a little bit worse for potential buyers.
Louis: Absolutely, yes. Listings were down by 4.7% for the month. So, right now, there are just 2000 listings in the marketplace for Hobart, and some years back, just to give you an idea, during the slowdown, Hobart normally gets about 10,000 to 12,000 listings.
There is hardly anything out there right now, Kevin, in terms of listings in Hobart. It’s definitely a seller’s market. Listings are down 26% year on year. I’d rather be a seller right now than a buyer. Let’s put it that way.
Kevin: In Canberra, too, listings have fallen just a little bit. We’ve seen a little bit of a lift in that Canberra market in recent times.
Louis: We have. The Canberra market did have a recovery in 2016 and 2017, and it appears so far this year that the recovery is set to continue. It’s not a boom by any means, but it is nevertheless a market that is favoring sellers. There are plenty of buyers. And the Canberra housing market has always been correlated to how much expenditure is occurring at the federal level.
Kevin: Yeah, because it flows through to employment, doesn’t it?
Kevin: Interesting comparison there too, Louis, just before I let you go. The capital city asking prices for houses rose slightly but fell for units.
Louis: That is correct. We have to be careful we don’t read too much into these numbers on a week-by-week, month-by-month basis, but it is true that we recorded some rises. For example, Brisbane recorded a 0.2% rise in houses and just a 0.1% rise in units.
It’s mixed overall in terms of what the asking prices actually did show. In Melbourne, for example, they recorded a 0.5% fall in houses and a 0.7% fall for units. So, mixed overall. I would say long-term, it’s showing that houses tend to perform a little bit better than units with regard to capital growth.
Kevin: Excellent. Always good talking to you, Louis Christopher from SQMResearch.com.au.
Louis, thanks for your time.
Louis: Good to be here, Kevin.
Real estate is all about the land – here is proof! – Shannon Davis
Kevin: One thing we do know is that when you’re investing in property, you have to be aware of what the trends are all the time. One thing that I’ve noticed, and I think my guest in this interview is going to reinforce, is that there are a lot more properties being knocked down – the land is the most valuable part of the investment – of course, and new dwellings being put on that, either single dwellings or double dwellings.
Shannon Davis is from Image Property, and they have offices in Melbourne and Brisbane.
Shannon, thanks again for your time.
Shannon: Good day, Kevin.
Kevin: Shannon, is it my imagination, or is this a bit of a trend?
Shannon: Yes. I think right now in the cap city that I have the most alignment to, in Brisbane especially, is we’re seeing a thirst for land. Those infill opportunities are becoming more and more scarce, and people who have land-banked or have recently purchased are paying higher and higher amounts to put contemporary properties in place of character housing or older-style properties.
Kevin: It makes it a very expensive proposition, doesn’t it, because effectively, you buy a house and land and you knock the house out, effectively paying that just for the land.
Shannon: Yes, and you have the full cost of construction to come later. And often, these are houses that are owner-occupied type houses where people want to build their dream house and they have higher specifications.
To give you an idea, we were at auction for a client recently and we were expecting a good price – it was in one of Brisbane’s best streets with great views to the back – but it just exceeded everyone’s expectations for the price to go out past $1.4 million for a knockdown. And that’s what we’re seeing in some of the better suburbs of Brisbane.
Kevin: I can understand if you’re spending that amount of money and you’re going to be able to take the house out and get two – or maybe even three – on it, because it does lower the site cost. But just to put house for house, to me, doesn’t seem to make a lot of sense.
Shannon: I think you have owner-occupiers who are either in successful businesses or well assured of their jobs and prospects at the moment and have always wanted that dream house to entertain and grow up their children and not want for anything. They tend to be good investments going forward, that they’re in the right areas surrounded by the right demographics and have the right dirt that makes up a good investment.
But you do see from time to time that these prestigious areas that are maybe double or triple the median price of the cap city can be prone to share market corrections, and sometimes those trophy type houses don’t make sense if there’s a recession or a big slide on the price of shares or a financial crisis.
Kevin: As we’ve already highlighted, the fact that the land is where the value is, if you’re buying an investment property now with a view to knocking it down in the future, what size block should you be looking at – 400 or 600 square meters?
Shannon: I think you should try and get a high land-to-asset ratio into your purchase wherever possible. Not all land is created equal.
I think what’s really driving this is you’ve got the big outer suburbs land-and-house packages, but people are wary of the commute. If you get stuck in that commute from 7:00 to 8:30, it can be a really long time. While you’re in there, there seem to be 80% of the cars on the road at the same time doing the school and work run.
I think that’s one of the things where people are wanting to move closer rather than further, and they’re happy to take perhaps a smaller block in order to build a house on that block and be further in with a smaller commute.
Kevin: Can I just ask, on that point, Shannon, Sydney and Melbourne, are we seeing a similar trend there?
Shannon: Yes, definitely. It has been for some time that you’re seeing people come in wherever possible and redevelop plots of land closer to the city. And while those markets have had a very good run and showing some signs of slowing a bit at the moment, you’ll still see owner-occupiers taking the time to build their dream homes and knock down what was previously there to reconfigure something that’s going to be more suitable for their lifestyle.
Kevin: I guess they figure that they’re going to hold it for some time as well, which makes it even more logical to purchase that way.
The Brisbane market is still very, very affordable. Are you seeing many people coming from Sydney and Melbourne because of the affordability and looking at getting a development happening?
Shannon: Yes, we’re getting more interest for rental applications, we’re getting more interested in unit blocks that we have for sale, development sites that we have for sale, and also, you start to see the move back up. Things get over-bought and over-sold, and I think for a period, perhaps Sydney and Melbourne have been over-bought and Brisbane has been over-sold.
You’re going to start to see that equalize a little bit more now because the gap is at its widest. The biggest problem was jobs not being created. That’s on the way back up. The migration is on the way back up, and there’s a much better affordability for lifestyle reasons to move to Australia’s third biggest city.
Kevin: Yes. Good talking to you. Shannon Davis from Image Property with offices in Brisbane and Melbourne. You can reach them at their website, of course, at ImageProperty.com.au.
Shannon: That’s correct, KT.
Kevin: Good on you. Thanks, Shannon, talk to you again soon.
Shannon: Okay. Bye.
The next suburbs to gentrify – Peter Koulizos
Kevin: As a property investor, you only have to look at different parts of Australia where gentrification has actually occurred to what the reaction is going to be, what the ramifications will be, and how that looks from an investment portfolio basis.
There’s some new research that’s just been released by the Property Investment Professionals of Australia, PIPA, an organization we strongly support, that’s revealed the next group of city suburbs that are set to gentrify. PIPA’s chairman, Peter Koulitzos, joins me to talk about that.
Hi, Peter. How are you doing?
Peter: Very good. Thank you, Kevin.
Kevin: This is such an interesting story, isn’t it? Gentrification is something that I only started to hear about 10 or 15 years ago. It’s been going on for generations, hasn’t it?
Peter: It has, yes. It was coined as gentrification back in the U.K. many decades ago – back in the 1960s, actually – when they started to see the gentry moving into older, down-and-out areas. And that’s also been happening in the U.S. where wealthier people are moving into the inner-city areas, and obviously in Australia.
Yes. There are many parts around the world where gentrification occurs – basically, people moving into areas that were regarded as blue collar, not very desirable to live in, but because of its proximity to the city or the sea, and very importantly, the historical buildings there, it attracts a lot of people.
Kevin: It’s all about lifestyle, isn’t it? If we look at the ones that have been gentrified recently that we’ve talked about, they are all close into the city, they are carrying older-style homes, which brings about a certain amount of romance too, I suppose, doesn’t it?
Peter: It does. And Australians love older property. The older, the better. It’s not uncommon for a 120-year-old house to sell for more than a 20-year-old house, everything else being the same. And from an economics point of view, it makes sense, because they’re not making any more original Queenslander style homes or Federation or Edwardian style homes.
Kevin: I’m going to ask you about the suburbs in just a moment, but the 20 different demographics that you dug into to get this research, tell me about that, just so that we know a little bit more about the research.
Peter: Sure. I did some academic research a little while ago, and I compared two suburbs that are next-door to each other in my hometown of Adelaide. I compared a suburb called Torrensville, and right next door to it is one called Brooklyn Park.
Just to give you an idea, Torrensville is similar to, say, Yarraville in Melbourne or Erskineville in Sydney. It’s only three kilometers from the city and full of character or period style homes, whereas Brooklyn Park – which is just next door – was really developed after World War II and full of 1960s’ homes.
I was looking for differences in demographic data, property data to try to determine if there are things that can be easily measured to help determine whether an area is going to gentrify or not. And as you said, I looked at about 20 different factors.
They included houses versus units, the size of the land, whether there was a big change in the people who moved into the area, was there an ethnic background to it, was it based on married people? So, lots of different demographic factors.
But in the end, I came up with four that seem to be fairly reliable in helping to determine whether an area is in the early stages of gentrification.
Kevin: Great. Let’s run through those quickly. What are they?
Peter: The first one was a greater decrease than the state average in people aged 18 years and under. In other words, a gentrifying area will have less children.
A greater increase than the state average in couples without children. Those two are very closely tied.
A greater increase than the state average in people who lived at a different address five years ago. What this is telling me is that for gentrification to occur, you need different people moving into the area.
Typically, what you’ll have is in these areas, there will be people who moved in 40 or 50 years ago and are now in their 70s and 80s and don’t have the money nor the borrowing capacity nor the skills nor the energy to fix up their homes. So, as they leave the area, then younger people, white-collar people, professionals move in. They have the money, they have the borrowing capacity, and they have the knowledge and the skills – or they can access people with that knowledge and skills – to fix up their properties.
Another very surprising factor for me was a greater increase in the percentage of females working in professional occupations. It wasn’t just anyone working in professional occupations. In particular, if you can detect an increase in the number of females who work in professional occupations such as managers, teachers, executives, architects, and so on, that is one of the indicators to help determine whether an area is in the early stages of gentrification.
Kevin: That last point you just made is really interesting, because females bring a certain amount of – how can I say this, Peter – class to an area. Maybe they’re a little bit more demanding about the style of restaurants that they’ll go to, the shops that they go to, and so on, but also working in professional occupations, they have a higher disposable income.
Peter: Yes, that’s right. And if you’re on your own with no dependents, whether you’re male or female, you have a higher disposable income. And if you’re a gay couple, generally only a few gay couples tend to have children, so you have a higher disposable income because there aren’t children in the household.
So, with a higher disposable income, you can spend more money on different things, including extending and renovating that character or period style home.
Kevin: Of course, any investor is really looking for these areas we’re talking about here so that they can improve the return on their asset. But I guess the secret is actually getting in there early. Because some of these signs we’re talking about, it may have already gone, what would you say would be one of the early signs that a suburb may be starting to gentrify?
Peter: Something I didn’t write in this particular article but I have read and spoken to other academics about is the movement of the creative class into an area – so artists, crafty people. Some of the physical signs you’ll see are little studios popping up in the suburb, and not necessarily on the main road but on the side streets. Maybe the electricity poles are painted. There might be a community garden with artwork. That’s a very early sign that things are happening.
But there’s no real fear of missing out, because the gentrification process can take 20 to 30 years. Places like Balmain and Paddington in Sydney didn’t come good overnight; they took decades to come good. Or places like Richmond in Melbourne or West End in Brisbane, they took a long time to come good.
You can try and guess which areas might gentrify, but I find that the safest thing is to look for the early indicators that it is already happening, you know you have 20 to 30 years in front of you to benefit from that, so you have a much safer bet by buying into the areas that are just showing some of these indicators.
Kevin: We’ve got a few seconds left, so let’s just quickly run through some of the suburbs that you have actually highlighted in Melbourne.
Peter: In Melbourne, Braybrook, Footscray, and West Footscray, all in inner western Melbourne.
Kevin: And Sydney?
Peter: Arncliffe, St. Peters, and Tempe.
Kevin: And Brisbane?
Peter: Annerley, Lutwyche, and Woolloongabba.
Kevin: And Adelaide?
Peter: Thebarton, West Croydon, and Hindmarsh.
Kevin: There you go. Okay, We’ll make sure that all of those suburbs will be listed for you underneath the commentary. Some great research and a really interesting story, Peter, so thank you for sharing it with us.
Peter Koulitzos is the chairman of PIPA, the Property Investment Professionals of Australia. Thank you very much for your time, Peter.
Peter: A pleasure. Thank you.
The factors to consider when comparing houses and units – Patrick Bright
Kevin: We had a question sent in to us from Monica. Thank you for this. Monica is simply asking whether or not houses make better investments than apartments?
I’m going to ask that question of Patrick Bright, who is a buyer’s agent from EPS Property Search. What’s your advice to Monica?
Patrick: It’s a good question, Kevin. I would say that yes and no would be the answer there, and in certain circumstances – because it depends on the market that you’re buying in, and it also depends on what the public and the buyers are demanding in those markets.
Kevin: Does it depend on not the type of market, but the market – as in the suburb – as to what type of buyer or tenant you’re going to be appealing to?
Patrick: Yes, exactly. If you’re looking in, say, a capital city, for instance – I know this because I know Sydney pretty well, I’ve been working in it for over 15 years – the market in the inner ring over a third of the suburbs, the capital growth, for instance, is better with apartments than it is with houses. If you go back 30 years ago, that was not the case. The market has changed, and it’s what the public and the demand is for, so you have got to have that aspect to it.
If you go out of a capital city, the majority of the stock out there is housing on larger land blocks. You’ll find – because I’ve looked at it – that those will do better than the apartments in a regional area.
Kevin: Those inner-city suburbs you’re talking about and some of the cap cities, we see they’re changing them as they want more density into some of these. They’re pulling down those houses and putting up apartment blocks. Obviously, that has contributed to that change as well, Patrick.
Patrick: It would have had to contribute. Yes, for sure. It’s the demand. It’s what people want. They want to live closer in. If you’ve traveled a bit and you’ve seen places like, for instance, Hong Kong and Singapore, it’s 90% apartments. People want the lock-and-leave lifestyle, they want views, they want all of that happening, and so if that’s where the demand is, that’s where the price pressure will be, and that’s where the growth will be, and that’s where the rents will be.
You have to have an awareness of the market you’re buying into, and where that market is going and where the future is of that market.
Kevin: Just to help Monica a little bit, is there a tipping point with the amount of stock? If you look at a particular suburb, for instance, and maybe it’s got 40% units and 60% houses, but there tend to be more units coming up, would that be an indicator for you that maybe it’s time to look at apartments, that that might be shifting a little bit?
Patrick: Maybe. Again, I would look at it carefully. Let’s pick on a suburb, for instance, Dee Why, which is on Sydney’s northern beaches. Now, apartments in that market, about 85% of that market is apartments, and about 15% houses. In that market, houses do better than apartments because there are too many apartments for the demand that you really want to be there.
There really isn’t a blanket rule that you can put to it. You have to really study the market, the type of people who want to be in that market, the demographics of it now and where it’s likely to go, and then make your decision based on that.
Is it like the Inner West? There are a lot of apartments being built in the Inner West, but still, terraces tend to outperform. Where you’re going to generally get better performance with an apartment is in an area often with views and some uniquenesses about it, and so that’s something you have to weigh in.
Kevin: Yes, history, of course, leaves great clues – doesn’t it – if you go back and look at the history of an area and analyze it. Over what period should you go back, do you think? Is it good enough to go back, say, three to five years?
Patrick: At least. Look, when I’m buying a property, I look at it this way. I look back even 20, 30, 40, or 50 years, and I say, “What was the prime real estate 30 or 40 years ago?” It’s generally the prime stuff today, and – guess what – it’s probably going to be the prime stuff in the next 30 or 40 years. That’s how I like to make my investment decision.
Yes, history leaves clues, but you also have to factor in where the future is going. If the future is going towards that type of product – say, a more apartment-style product – and you’re in the right location, you should do very well. Particularly, if you’re in a land-locked location, and you have something unique about it – you have got water views – that sort of thing is very appealing to the market.
Kevin: Yes, very interesting, mate. Thank you, and that’s certainly answered Monica’s question. Once again, Monica, thank you very much for your question.
Patrick, to you, thank you for joining us today.
Patrick: Pleasure, thanks, as always, Kevin.