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from My Renovation May 2022

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PROPERTY’S TIME IN THE SUN –INSIGHTS FROM BERNARD SALT

Social commentator Bernard Salt believes COVID will trigger a shift away from CBDs to suburban hubs and regional lifestyle areas, with Australians seeking more spacious homes with a ‘Zoom room’. Source: AAP

Aft er the real estate market’s unanticipated pandemic surge, property trends are being shaped by the post-COVID lifestyle expectations of Australians. So where will the next wave of property investment opportunities come from?

At a recent Investor Breakfast Briefing hosted by alternative investment platform AltX, social commentator Bernard Salt discussed the demographic trends underpinning Australia’s property momentum, and the growing interest in private real estate debt in Australia. PROPERTY AT THE HEART OF AUSTRALIAN VALUES Australians (baby boomers in particular) have a strong aff inity for real estate, according to Mr Salt. And as a relatively rich country per capita – ranking 13th globally by GDP in 2020 – the place where they feel most comfortable investing their money is in housing.

With record-low interest rates, Australian investors have been snapping up properties. Investor loan commitments rose 6.1 per cent in January 2022 alone, according to ABS data. But wholesale investors are also putting their money into the debt underpinning all that activity – investing in first mortgage-backed private real estate loans through platforms.

AltX research into investor preferences revealed one in two investors say the main reason for investing in private real estate debt is that they know what they’re actually

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investing in, and 47 per cent prefer to invest in individual deals.

PROPERTY WILL BE SHAPED BY OUR POST-COVID LIFESTYLES Mr Salt believes the pandemic has ushered in a return to Australian core values – including an emphasis back on our homes.

“Today, we expect to be able to work, study, shop and be entertained within our family home,” he says, explaining floorplans may now include a ‘Zoom room’ and home gym in the garage.

He dubs another major COVID phenomenon VESPA: Virus Escapees Seeking Provincial Australia. Those who have the opportunity to work from home are moving to regional areas, within striking distance of a major capital city or centre.

All these trends will potentially change how we live, work and play in city centres, and what we need from our urban landscape.

Mr Salt believes people will still want to stay close to where they live – being close to shopping and entertainment and having a sense of community connection are all more important than ever. And he sees this fuelling a shift from the ‘fried egg city’ with the CBD at the core, to a 20-minute city where strong suburban hubs provide everything people need.

“Demand for real estate may well shift in the post-COVID world, due to changed consumer behaviour (less shopping centres, more fulfilment centres) and working from home (more spacious houses, less demand for city centre off ice space),” he says.