The Rules of Investing 30-year property veteran: Australia has its head in the sand on housing
There's no supply in residential housing nor the majority of segments of the commercial real estate market. Sky-high construction costs are now too prohibitive. Bandaid solutions, like rent control, only backfire. And inconsistent state, federal and local policies are not helping either.
That's according to this week's guest on The Rules of Investing, Andrew Parsons, a founder and the chief investment officer of global listed real estate manager Resolution Capital.
While these factors continue to perpetuate Australia's housing problem, they are actually positive for long-term investors in real estate.
In this episode of The Rules of Investing, Parsons dives into Australia's property problem, outlines what he believes to be the solution, and shares why listed property is in for a strong three to five years ahead of us.
Note: This episode of the Rules of Investing was recorded on Wednesday 17 July 2024.
Timecodes
- 0:00 – Introduction
- 2:06 – A fascinating, under-appreciated part of the market
- 3:45 – What is a REIT?
- 5:30 – The key distinctions between REITs and physical property assets
- 8:45 – Which do you prefer: an investment property or listed property assets?
- 9:50 – Where REITs sit alongside equities and fixed income
- 10:55 – What you’re really paying for when you buy real estate
- 12:50 – Why property development is so difficult currently
- 13:40 – Australia’s troubling property supply shortfall
- 15:04 – “We don’t want urban sprawl”
- 16:30 – How do you solve Australia’s big property problem?
- 20:50 – The effect of interest rates on listed property, versus equities and bonds
- 23:40 – How Resolution Capital is currently positioned
- 33:50 – What is your best investment of all time?
- 38:08 – Resolution Capital’s five-year pick