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Finding Your Balance Amid White Property Noise

Posted by Paul Wilson

My definition of white property noise: a mixture of opinions, commentary and speculation, often conflicting, about all aspects of property investment.

White property noise is a big issue for fresh-faced investors as it can be extremely overwhelming, stressful and hindering to the progress of their investment journey.

In some cases, they give up before they even get started purely because it was just too much.

It must be said that new investors are not alone in this respect; seasoned investors are also affected in varying degrees by day-to-day reports of how the property market is performing.

But it seems that lately, investors have become immune to Australian white property noise, or have at least chosen to ignore it and base their decisions on cold hard facts and figures.

The latest Smart Property Investment/ PIPA Property Investor Sentiment Survey indicates that despite talk of property bubbles and concerns that property price growth is unsustainable, confidence in the Australian property market remains high.

According to the survey, 80 per cent of investors believe now is a good time to invest in property, and 68 per cent are looking to purchase within the next six to 12 months.

Low interest rates continue to play a big part in investors’ confidence and activity, with 30 per cent of investors citing this as a reason to buy in the current market.

Confidence aside, we are more connected than ever in terms of technology and up-to-the minute data being readily available so it poses the question: how do you screen out the white noise and find balance in what’s being said?

-          Find someone with property investing experience in whom you can trust

Forget the news stories, forget the opinion pieces – find someone that you know, who has experience in property investing and consider them as one of your most valuable assets. This person shouldn’t have any personal involvement in your investments e.g. your mortgage broker or real estate agent. While these industry experts are a valuable resource for their specialised advice, they could also be perceived as having a conflict of interest, even if their intention is for discussions to be more neutral in nature.

-          Limit your reading

Yes, you read right. To get a better understanding of where the market is heading, limit your reading of property news and opinion pieces. This advice is for investors who stay up til 2am trawling through that day’s reports. Instead, get your daily dose, be happy with it, make your own evaluation and move on. On the other hand, start reading reputable sources that produce statistics and data only – that way you’ll have no choice but to make your own comparisons and evaluations on previous data. You can also become a tech-savvy investor by creating Google Alerts to have specific information delivered to your inbox, eliminating your search time and only reading what you want to.

-          Take a step back

This doesn’t mean stop investing, it simply means take a look at the bigger picture. As an asset class, investment properties should be held for a medium to long-term period. Yes, in a micro analysis of markets there will be troughs and peaks and some larger than others. But when we step back and look over a 10 to 15 year period, history shows that there is a higher level of stability. It also demonstrates that those who really miss out are the ones who hesitated on taking any action at all or who set their expectations in a time frame that had a greater chance of letting them down. We’re all guilty of getting caught up in the minute details, so try not to over-analyse or sweat the small stuff because it (by it, I mean opinion) can change overnight.

Until next time,

Paul Wilson. 


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