Property Pulse

Property Investment Advice '” Safe as Houses? (see resource attached), a bipartisan report tabled in Federal Parliament this week, recommends that property investment advice should come under the jurisdiction of the Australian Securities and Investments Commission (see link below); that anyone giving property investment advice should hold a financial services licence; and that a scheme should be established to protect investors and give them avenues of redress.

With many thousands of investors at risk of being ripped off by biased or poorly researched advice, these changes cannot come soon enough.

The report says that anyone who offers projections about investment property (including me, as a director of a company providing property investment advice) '” as distinct from describing past performance '” is providing “advice” and, therefore, should be subject to ASIC rules.

I have always argued that property bought as an investment should be considered a financial product, just like shares, bonds, superannuation and managed funds. And it is only fair that anyone who provides advice on future performance should be suitably licensed. So it’s gratifying to see some politicians taking a similar view. In Parliament on Monday, speaking on the report, Chris Bowen said: “It is incongruous that '¦ people giving advice on almost every asset class in this country come under Federal Government regulation except for those providing advice on property.”

The Government should act quickly on these recommendations.

AUCTION AUCTION

Auction activity varies across the three main markets this week. In Sydney, advertised auctions are down from 230 last week to 178. This is the first time in eight weeks that the number has fallen. Property pundits are scratching their heads as to why, but already there are signs the number will be up dramatically next week.

In Melbourne, there are 501 advertised auctions this week, up slightly from 488. This is the first time in nearly three months that the number has broken the 500 mark, a sign that spring auction frenzy is beginning to build momentum. However, the peak of the spring market, when auctions are closer to 1000, is still some way off.

In Brisbane, the auction number has surged, from 159 last week to 201.

OPPORTUNITIES

If you’re looking for property in Sydney this week, the upper North Shore, bucking the citywide trend, could offer a less competitive environment. There are 33 advertised auctions, up from 24 last week.

In Melbourne’s north-western suburbs, 41 auctions are scheduled this week, double last week’s number.

Look for good buying opportunities on the Sunshine Coast, where auctions are up from 31 to 50, and in south Brisbane, where they are up from eight to 17.

MINEFIELDS

If you are looking in Sydney, be wary about paying too much in the wake of heated competition in the St George area, where there are just five auctions; the Sutherland area, where there are only four; and the inner-west, which has 23 auctions down from 32.

Watch your pennies if you are bidding in Melbourne’s Bayside area, where auctions are down from 47 to 38.

And in Brisbane, be careful in the CBD area, which has only 22 auctions this week.

Mark Armstrong is a director of Property Planning Australia