#128: Upgrading and planning for the long-term home: how to keep a home as an investment, buying or selling first and more. Market updates:

The Property Trio

https://propertyplanning.com.au/propertyplannerbuyerprofessor/ In this week's episode, Dave, Cate and Pete take you through: Market update 1. Thank you for your feedback We've received a number of listener reviews that are insightful and also gave us honest feedback, which we really appreciate. One was in relation to past performance bias, specifically whether past performance reliably predicts future performance and also the impact of our own personal biases. The Property Buyer acknowledges this feedback and hints at a future episode that will address human biases. 2. The state of retail property In the most recent JLL quarterly retail market report, the CBD retail vacancy rate in Adelaide is the highest it's ever been since 1993 at 16.8%. Regional retail has only a 3% vacancy rate. However, 'regional' in the retail sense has a different meaning to residential property. The Property Professor explains all in his market update. 3. Inflation is the talk of the town, but is it here to stay? Increasing inflation should lead to increasing wages, but most people assume that it equates to increased interest rates, making many nervous. Underlying inflation in Australia jumped to a six-year high of 2.1% in the September quarter, which is still well below the 4.6% experienced in the US. This level of inflation is only at the lower end of what the RBA targets, (being between 2% to 3%). The Property Planner talks through the factors that create upwards pressure on inflation, the RBA's response and whether inflation at this level is sustainable. Considerations for upgraders 1. How does upgrading fit into your property plan? The earlier you can start planning for your long-term home, the better. However this does come down to stage of life, and often people are not able to picture their future home until they've reached a certain level of stability or decided on the location that they want to live in. Understanding how your investment decisions and other lifestyle purchases fit in with your decision to upgrade is also key to making successful long-term purchases. For some, the long-term home may be out of reach due to stage of life or circumstances. For some who aren't ready to upgrade, rent-vesting or a stepping stone home may be the right choice for you. 2. Mapping out your future home Many buyers get hamstrung when it comes to the critical decision making because their search criteria is unreasonable. Having a clear plan on which suburbs to target, property types, architectural styles, land size, bedrooms and living spaces, (to name a few) is key to narrow in your search. Then, to ensure that you don't get bogged down and spin your wheels while the market continues to run away from you, have a plan of what you will be willing to compromise on if your dream home is out of reach. 3. Purchasing a property that you can grow into The holy grail of property ownership is only ever owning the one home, because each purchase and sale of a property eats into your wealth. Due to changing commitments and affordability, not many are able to achieve their dream home on the first go. However, you may consider buying a home with a larger block size with a smaller dwelling, where you could extend the home as your family grows, to avoid needing to sell. 4. Why are money goals so important? Finding a property that you want to live in for the rest of your life can be like finding a needle in a haystack and many are willing to pay an emotional premium to get into their dream home. In this situation, we're more likely to be stretching ourselves to the largest level of debt that we'll ever take...