Unique analysis of property investment data
“The data was also analysed chronologically with each dataset comprising 1000 investment properties, meaning trends are assessed using equal sample sizes over the time period rather than by defined date ranges”
The 2020 report covers four datasets from schedules commissioned between January 2016 and December 2019. The data was also analysed chronologically with each dataset comprising 1000 investment properties, meaning trends are assessed using equal sample sizes over the time period rather than by defined date ranges. This approach reduces anomalies that can occur by comparing unequal sample sizes which can arise when defining data sets by time period only.
While the information is collated from depreciation reports nationally, the analysis also breaks figures down into subsets such as location, property type and investment type (e.g. renovation, new construction, existing home etc.) This has enabled MCG to observe trends in investor sentiment from quantitative analysis, and then draw conclusions based on their qualitative experience as well as information derived through their networks in the property market. Also of note, while the data does describe trends across an approximate four-year period, each 1000 asset dataset is an interesting frieze of Australia’s property investment market at a given moment. Of particular interest is the latest 1000-asset dataset which describes the sector from April 2019 to December 2019.
While the entire report reflects the culmination of five year’s work, progressive analysis since 2011 has allowed MCG to deliver compelling commentary to both their client base and across a range of media. For instance, much of MCG’s information around negative gearing and property ownership provided the foundation for news reports in the Australian Financial Review and News Corp outlets in the lead up to the Federal Election in 2019.
The aim of the 1000 Assets report is to present a comprehensive study of nuanced information collected directly from real life investment property case studies, with a view to removing the somewhat ‘insulated’ nature of algorithmically based, big-data analysis..
Some a the major trends identified in the report include:
Changes across the four years of the study: • An increasing in interest for new/off-the-plan investments over existing property, • A major rise in investors choosing townhouses as an investment, • An increase in the average number of units per development project, • A notable increase in investors building bigger, more expensive houses, • The amount paid for a detached house investment grew by around double that paid for
a unit over the past four years.
Data from April 2019 and December 2019: • Almost half of all investments analysed were renovated after purchase, with an average
spend of approximately $37,500 • Around 1 in 4 investors lived in their asset before renting it out. The average length of
pre-rental habitation was four years, two-and-a-half months. • The average size of a detached house investment is almost double that of a unit. • The average construction cost of a newly-built, detached house investment is: $353,473. The report also broke down some results across NSW, Vic and QLD.
You can view the report in full here: MCG 1000 Assets Study: 2020