Property Hub - Investment Insights & Inspiration - Realty Talk: The McGrath Report – Chaos creates opportunity!

Episode Date: October 8, 2022

As industry guru John McGrath continues to reinvent real estate and grow one of Australia’s largest networks, he joins Kevin Turner and Bushy Martin to unpack the latest McGrath Report where he reveals the changing trends that are driving property and his predictions on the future, that collectively demonstrate how chaos creates opportunity.  RealtyTalk is part of the Property Hub podcast channel, your home for property investment insights, inspiration, and stories from Australia’s top property experts, investors, leaders, and analysts. Subscribe now to get every RealtyTalk episode delivered to you each week for free, and also get full access to Get Invested, the leading podcast for Australians who want to unlock their full ‘self, health, and wealth’ potential and get inspired by the stories of investors, founders, and entrepreneurs. Subscribe to RealtyTalk on the Property Hub channel: Apple Podcasts | Spotify | Google Podcasts | Email Property Hub is a collaboration between Bushy Martin from KnowHow Property, Kevin Turner from Realty, Andrew Montesi from Apiro Marketing and Apiro Media, and Australia’s largest independent podcast network DM Media. Business and partnership enquiries: [e-mail] omnystudio.com/listener for privacy information.

Welcome to Realty Talk, the show that brings together the country's most authoritative and respected property experts. Follow us on all the socials and subscribe for updates and exclusive offers. Realty Talk is powered by Realty.com.au, connecting buyers, sellers and agents differently. Hello and welcome to this week's show. Well, today we're joined by a luminary of the property industry, John McGrath. John is the founder, current managing director and CEO of McGrath Estate Agents. And with 111 offices, McGrath is considered one of Australia's largest real estate networks. John is a former judge of Channel 9 hit renovation TV show The Block and was also an investor on season one of Shark Tank in 2015.

Well, today, Bushy Martin and I will dissect the latest McGrath report on property in Australia. And amongst other things, we're going to talk to John about the COVID influence on housing, the current rental crisis that we're in, the property ripple effect, bridesmaid suburbs and John's postcode shift. In the description below the show today and on the website, you'll find a download link so you can get your copy of the full report and we give that to you with John's compliments and we thank him for that. So stand by Bushy Martin and I back in just a moment with John McGrath. Property depreciation is the natural wear and tear of a building and its assets. Property investors can claim depreciation as a tax deduction each financial year. Depreciation

is a non-cash deduction. This means you don't need to spend any money in order to claim it. On average, BMT tax depreciation find residential investors almost $9,000 in first full financial year deductions. Call BMT on 1-300-728-726 today for an obligation free quote. Hello and welcome to the show. As we said at the start, we're going to be joined by John McGrath as we look at the McGrath property report. Always look forward to this report coming out.

It's very, very extensive. John, thank you so much for your time. Great to be talking to you. Thanks, guys. It's good to be here as well. Yeah, I think we've got you. Where are you in Parramatta right now at the Parramatta office? Yeah, a little bit further west at Blacktown.

So we've got a couple of our, interestingly, our fastest growing offices, probably not surprisingly, they were in the west of Sydney and Blacktown, which is kind of very much the heart of, you know, sort of the market at the moment, which is good. So we've just been out here this morning getting the troops up and ready for the day. Good.

Excellent. I said it in the intro, there's 111 offices. You're looking at growing that. We will talk about Queensland, but good growth on the back of what's happening in Queensland for you? Yeah, look, across the East Coast predominantly, Kevin, we think that we've got the opportunity to double the footprint or the size of the business in the next three years.

But Queensland will definitely be a focal point, not just because I'm talking to you guys, but I think it's going to be a rapidly growing market. There are so many positives for Queensland at the moment that are pointing towards more price rises. And as I think we're going to talk about in the next session, I think that there's good news. Yeah, John, let's get into the report.

Let's dig straight into it. And, you know, no doubt right up front, we're not really surprised we talk about COVID. And, you know, COVID's had a massive impact on us. But in particular, I like the way you focused on the impact on housing because there have been some benefits that have come out of COVID, haven't they? Well, interestingly, I mean, everyone thought COVID

was going to be the end of the economy for a moment there, and yet we ended up having a 20% or 30% increase in most markets. But not only that, one of the things that we're highlighting in the report is the fact that COVID is sort of changing the way people live literally in the space of the last couple of years. I mean, clearly one of them is work from home. I think the last statistic I saw in the Sydney CBD anyway was 50% of the office buildings were still without people in them,

which has meant that 50% of the staff are probably never coming back to those places. So they're clearly either regionalised or more likely working from home remotely. So that's going to put some different strains on the household. I think things like the obvious of, you know, work-from-home spaces where people can actually carry on a full-time job at home, that's going to change the shape.

that's going to require a lot of people to upgrade the size of their property, but it also means you're going to spend a lot more time at home in general. So you've got things like lifestyle amenities, you've got things like home gyms. I think you're going to come back into vogue because, you know, people are going to really retire back to the home, not literally retire, but come back to the home

to be spending more time. So I think it's interesting, and we've seen from a design perspective already different shapes and sizes starting to emerge off the back of the COVID trends. Yeah, you make an interesting reference in the report to barkitecture, John. I'd love for you to expand on what that means. Yeah, well, as you say, the barkitecture is, you know, during COVID, a lot of people decided, well, if we're going to be home, I better have my new best friend, which will be a dog or maybe a cat. And the number, statistically, the number of people that bought dogs during the COVID and cats went up tremendously.

And so that's just another example of lifestyle. So a lot of people that were in units might be now looking for a small piece of turf where they can have a cat or a dog. They might need an extra bedroom now to convert into a home office. So these things are happening. I think they're all positive trends. I think giving, you know, human beings the flexibility to work from home or obviously going into the city is a good one. and it's also certainly going to help the regional areas or areas outside of the major metro because, you know,

the commute in and out of CBDs was treacherous, but now you may not have to anymore. The interesting point you make in that report too, John, where you talk about the mentality shift or the fact that we've had to move from open spaces, which we've built a lot of houses in our time and we always went for that big wide open spaces, but COVID's sort of driven us and shown us that we really need to have those get-away-from-it spaces on our own.

Yeah. I think defining spaces, Kevin, which can happen somewhat with furniture but also, you know, flexible sliding screen doors and the like, I think rather than perhaps having a locked-off third bedroom or study, people will have a third room adjoining a living space but the ability to slide the doors closed for privacy or for Zoom calls like we're doing today. So I just think it is going to create more flexibility.

It's a good thing. I think people are now looking at how they're living their lives a bit more intimately. A lot of people that were thinking of retiring and going somewhere else to live, well, now they're going somewhere else to live and work at the same time rather than waiting for another five or ten years. Yeah, very good point.

You sort of pick up on another trend there in the report as well, John, where it's lovely to talk about what you mean when you say that, I'll ask the question, if Australia's place in the sun is set to rise? Yeah, well, look, you know, at the moment, we're probably most markets that we're talking to today are probably somewhere heading down or towards the bottom of their cycle. But I think there's so many positives looking forward. I mean, if we have a look at what we've got coming, we've got immigration returning post-COVID. we've got a huge amount of skilled workers are going to come back to Australia and including expats. We've got record low unemployment. So we've got a pretty solid economy there. Yes,

we've got interest rates that have gone up a bit, but they're still about half traditional long term averages. So it's more the shock of them going from 2% to 4% rather than the 4% because the 4% is actually not too bad. You've got most people deleveraged, interestingly, which is kind of a fancy name for paid off a lot of debt during COVID, partly because they were scared of what might happen and partly because they weren't able to travel and spend money in other ways that they could have previously. So I think you look at it and you say, well, yes,

it does feel like we're kind of in a deep, dark place at the moment, but if you look ahead and, you know, the three of us have been through a few cycles for sure over the years and when you're in the middle of them, they feel like they'll never end and when you're in the middle of a boom, you think it'll never end either. But I think that we're probably 12 months to go in the kind of current market sentiment that we're feeling. But I do think that Australia is going to be,

and not just because of COVID, just a lot of expats are going to want to get back here for various reasons. And even what we spoke about, Kevin, which was the, you know, working from a distant location, once upon a time you kind of felt, well, if I'm going to work in, if I'm going to do business in Sydney, I have to be in Sydney or Brisbane or even London. But nowadays, it's commonplace for people to be working remotely, even different countries, and carrying on a good consulting business, advisory board, directorships.

There's a whole range of consulting people can be doing from remote. So I do think that COVID, as tough as it was for us all to get through and as sad to have lost as many lives as we lost, I think there's going to be some silver linings and some benefits to people as a result of having it in our lives. Yeah, that shift to regions is really interesting. And I want to pick up on that a little bit later, John, because I think it's brought on a lot of pressure for councils to, you know, look at the increased demand for accommodation. But just before I go there, in a similar vein, I just want to talk about the rental crisis that we're seeing

in Australia right now, which has been brought on, I think you say in your report, you know, the sudden absence of new migrants because of COVID. it. Do you see a solution to this rental crisis that we're facing? Well, it's going to get a bit worse, I think, Kevin, because right now developers and builders are just not building anything because either they can't afford it, they can't get financed, construction's gone up, costs have gone up 30% to 35%, and prices have probably come back 15%. So I think a lot of developers are just going to sit on their land for the next couple of years. So the shortage that we see today is

going to continue if not well it'll actually get worse because migrant numbers are going up and new bills are coming down so i think there's going to be a bit of a problem there um but over time these things always sort themselves out investors as yields go up because rents will go up and investors will say okay the yield the increased rent is going to help the increased uh interest rate that i've got to pay so you know these things have got a funny way of sorting themselves out over time but the next couple of years i think we're going to continue especially in the big metro markets to find that there'll be pressure on rents upwards and there's going to be a shortage of rental stock unfortunately for tenants because it's it's it's terrible you

know it's a roof over the head and some people are having trouble finding anything from a rental perspective yeah i think the rising rents and the extremely low vacancy rates are a pretty clear uh reinforcement of what you've said really important that is that we're really in the eye the storm before we see yeah though you start to rise again in the not too distant future yeah yeah totally but of course that will invite investors back into the market um a lot of people as we've seen over previous cycles in times of uncertainty people tend to flop back to bricks and mortar it's well known to them especially baby boomers and and the generation below um it's comfortable uh it's less liquid so it's less likely to have the kind of ups and downs you

you know, over time that the share market can often provide. So I think probably two years of a tight rental market, but then we'll start seeing it normalise after that. Yeah. It's interesting you quote Tim Lawless from Cool Logic in your report actually a number of times, which is really good. And he talks about migrants to Australia and how they have a tendency to rent before they buy.

That obviously has a lot of ongoing benefit long-term, but short-term it's going to increase that demand on rental properties, John. Well, yeah, I mean, the government initiatives to invite and attract skilled workers, which is a great one, and we need them. In fact, we need workers of all different levels of skills in Australia because I think everything from, you know,

the bush and hospitality right through to white collar is in demand. But I think you're right, they're going to just add to the already over-flooded rental pool at the moment of tenants. So, again, good for investors, not so good short-term for tenants, but I think you've just got to hang in there until things get a little bit easier. Stay with us.

Our guest is John McGrath. We're looking at the McGrath Property Report. We're going to come back after this very short break. We're going to talk to you, John, about the ripple effect, the bridesmaid suburbs, and your interesting point about the postcode shift. stay with us John McGrath and Bushy McGrath and I will um sorry Bushy Bushy Martin too many m's I will return in just a moment successful property investment is a game of finance

do you have the right team and the right game plan realty talk is brought to you by know-how property more than mortgage brokers Bushy Martin and his team of investment architects set you up with a sustainable strategy structured to lower your costs, tax, risk and stress while increasing your capacity for growth. KnowHow has helped over 1900 homeowners and investors secure more than $800 million in property wealth. So get set to live more, work less and live your legacy. Want to know how to invest in your freedom? Visit knowhowproperty.com.au. Welcome back to the show. Our guest is John McGrath, and I'm joined by Bushy Martin. Get it right this time, Kevin. And we're talking about the McGrath Property Report. John, I want to go

to a section where you talk about the ripple effect, and we've heard that before. But But the pandemic, once again, has played a role in this, in that ripple effect and brought on some bridesmaid suburbs. Tell us how you see those. Yeah, Kevin, look, you know, there are fashionable suburbs and there are less fashionable suburbs. And ultimately the less fashionable will become fashionable. And I look for Sydney-siders that might be looking at this.

You look at areas like Redfern that were once considered, you know, taboo areas and dangerous and risky and so forth, now they're some of the trendiest you know inner city enclaves in the country and as we saw prices shoot through the roof during pandemic i think it started to force people to look for similar lifestyles nearby but less expensive and often that's areas that need gentrification areas that are a little bit more remote or areas that might have some sort of structural issues but in the future they'll be resolved so what we have found is that we're starting to see a ripple effect or or a trickle-down effect, if you will, where some of the suburbs,

less fashionable suburbs, are starting to really get a move on fast. So I guess what's in it for potential investors currently listening to this is, you know, have a look at and be prepared to maybe look at taking some calculated risks on suburbs that might have a bit of industrial activity or a little bit of aircraft noise or something like that, that in the future may well change, or infrastructure, again, I'm referring to Sydney in this one, but Brisbane is the same.

There's been some infrastructure changes that have all of a sudden made suburbs that were a 45-minute commute to the city now all of a sudden they're a 25-minute commute. So if you'd have identified that a few years ago and got in early, you probably would have doubled your money. So I think it's just being flexible. People say to me, oh, you know, my kid's never going to be able to afford, and I'm sure everyone listening, no matter what age they are,

probably felt when they started they wouldn't be able to afford their first home. I mean, it's always the hardest one to get on the property ladder. But I think, yeah, have a look around, look at the fashionable suburbs and then say what is the closest, proximate, less fashionable suburb around and, you know, is there some merit in looking at that for an investment or even to move into?

Yeah, well said. It's always worth putting the future glasses on and looking at an area and what it's going to be in 10 years' time, not what it is today. and I think you make some really good points in the report where we you know overall we might be seeing median values soften but contrary to that some of these bridesmaid suburbs have actually been increasing in value so the devil's always in the detail around that but sort of shifting to another area of the report you sort of suggest a shift from the beach to the bush what what's happening and why and what are some of the challenges and opportunities that this is creating

Well, I think, Bushy, it's the overall COVID factor that people are now bringing their retirement forward or they're seeing that they can work remotely. And, of course, beaches and rivers, waterways have been a huge favourite for every generation, for all Australians, for many, many years. And what's that done, of course, when you look at areas like Noosa and you look at Gold Coast, Sunshine Coast, and they've become very, very expensive. you so what we're finding a lot of people now is they're saying well i do want to get out of town i do want to be within a few hours of a big city to visit the grandkids or to travel when i need to but maybe i can't afford the lifestyle i want on the beach or maybe i just like a tree change more than a sea change and i think you know that's becoming you know really really popular so two to three hours from the big cities especially on the east coast where you can find a tree change

opportunity um it's very very popular mudgy in you know he's about three hours west of sydney and that's probably our fastest growing office at the moment the the the values and the sales and the demand from from sydney for example have been extreme over the last couple of years so i do think that um people are not just looking for a sea change now tree change and we look at tasmania we've just opened a couple of offices there bushy and we're excited about tasmania we think it's going to be a great option for for people around australia that want a little bit more value for money it's got great sea change and great tree change potential there so i'm excited you know that people are now i think courtesy of the internet um and courtesy of covid two two kind

of major impacts to our lives in recent times people are now flexible they're looking elsewhere once upon a time you were born in a suburb and you probably lived there for the rest of your life and you bought a house just around the corner from your family. People are now exploring new lifestyles and sometimes it's well away from where they grew up. So I think for real estate, as tough as some of these things have been, it's actually pointing towards a more interesting future for us. Yeah, I agree.

There's some commentators, John, that have been sort of suggesting or questioning whether this is a permanent trend or whether it's more a bit of a boomerang short-term reaction to COVID. What are your thoughts on that? Look, I think it's a permanent trend, Bushy, but there'll definitely be some people that try it and it doesn't work for them. In fact, I was talking to our, I think it was our Butterham team

the other day, just north of Brisbane, and they were saying to me that there'd definitely been some people from south, from Melbourne and Sydney, that had come up there in search of a sea change lifestyle and it hadn't worked for them. So no doubt there'll be some people that trial it, maybe out of 100% that trial it, 80% will love it and the other 20% will fall back into a bigger city environment. But I do think it's a definite long-term trend,

but there'll be examples of people that it just doesn't work. John, the feedback that you're getting from some of your offices, and I think you mentioned there, was it Mudgee? Yeah. The growth, yeah. I'm interested in the feedback you're getting from them because I think it's been about 40 years since we've seen the kind of growth in the regions outstripping that of these cities.

that's putting a huge amount of demand on building infrastructure. So what are you hearing from your people on the ground about the demands in those areas, John? Oh, look, it's interesting because it's not just, you know, the big city buyers moving there. It's a lot of local demand. I think the rural and regional areas have economically done particularly well over the last decade, as we all know,

be that through mining or agriculture. It seems to have been a pretty good time. and I think that, you know, they're enjoying a good economy. We're also seeing a sort of mini boom in terms of infrastructure and what some of those towns offer. You know, Mudgee's a great example, beautiful tourism, hospitality, it's got great vineyards, it's got great lifestyle and it's three hours from Sydney.

So, you know, that's just a good example. So I think that this trend is going to continue and it's not just isolated, right around the country. We've got one of our fastest growing offices in Ballarat in Victoria also, a couple of hours out of Melbourne, but accessible to Melbourne. Beautiful, beautiful environment. A bit chilly in the winter, but beautiful environment there.

And people are saying, hey, I've always dreamed of living, you know, with sort of on a quarter-acre block or on five acres or ten acres, if you will, and I can still be in Melbourne in two hours for a meeting if I need to be. So I think this is a trend. And I think all it took was a bit like Zoom. We're on Zoom now.

Zoom existed before COVID. but not too many people used it. COVID forced us to use Zoom, and now all of a sudden it's commonplace for meetings and events as we're doing here. And I think it's the same, that the opportunity to work a bit more remotely in sea change, tree change communities was always there, but it's kind of been brought to our attention and things like Zoom have made it easier, and work from home

has made it an easier thing. So it's kind of just brought it to the surface. John, just a couple of questions before we go, before I'll just mention that if you'd like to download the McGrath report we've made it available a special link in the description below here so John thanks for allowing us to do that because you know this is just so full of so much tremendous information and stick around too because at the end of the show Bushy and I are going to go in a little bit more detail about some of the areas that John and his team have highlighted in different parts of Australia so we'll do that in

just a moment but but john um just in closing a couple of questions if i could what do you see as the um looking ahead bring your question board out for the next 12 months where are we headed i think that we're probably gonna we've seen in the big cities sydney melbourne brisbane predominantly we've seen we're getting towards the bottom of the market i think we've seen about a 15 percent decrease um and i think that there may be a few percent to go but i think we're pretty close to the bottom. I think it'll stabilise at the bottom. I think once interest rates have reached their stable position, people will start coming back in in larger numbers. As we've mentioned previously on the chat, I think you're going to find immigration, plus people coming

back naturally into the market, plus a solid underlying economy, which is underpinning all of this. I think you might see a little positive pop bounce back in about 12 months' time, and then you know we're kind of getting ready for the next cycle but i think that when i was talking to someone bushy and devon yesterday and i said look if you can pick within five percent of the bottom or the top of the market whether you're trying to choose one to buy or sell in you're a genius no one can pick the absolute bottom so anyone any buyer that's out there waiting to find what is the best month to buy in you're never going to do it but if you can get within five percent on the way down or five percent on the on the way as the market starts climbing you've done well because

you've got a 10% or 15% discount built in already. So I think that buyers are starting to – we've seen numbers starting to improve at Opens as we get into spring. So I think it's going to be okay. There's obviously some bad news to come, just general economy stuff, but that will all wash through the system. There's still a lot of good news. The Australian dollar is at 66 cents when I last looked a couple

of days ago, and so for overseas investors and expats in the States, they're getting a 40% built-in discount on US dollar. So I think there's also going to be some attraction, especially for expats, of reinvesting back in Australia. Yeah, well said. I think the sort of theme of the report, John, you know, chaos creates opportunity, really sums it up. Have you got any further thoughts as we bring it to a close around that?

No, I just think, Bushy, look, you know, these can be for some people tough times, But for most people, I think there's good opportunity. A lot of people that couldn't afford the house of their dreams this time last year now can. That's a positive. I think whether you're buying or selling, you've got to take a long-term view. This is not like the share market. You can buy something this morning and sell it this afternoon.

You've got to take a long-term view. And if you found a home your family loves and you can afford it, I'd be saying pretty good time to buy right now. If you're selling, I think you're probably going to be sitting around these levels for a couple of years. but then you'll start to see a little bit of an increase thereafter. But, yeah, times are good, and hopefully we can touch base in the near future and sort of see how our expectations fared. Yeah, very well said. You've had a great track record of being right in the past,

so I have no doubt it'll be the same this time around. And on behalf of Kevin and I, John, we just really want to thank you for sharing these very valuable insights today, and thanks for your generous time on the show. Absolutely, my pleasure. It's always a pleasure to speak with you guys. And, Kevin, you've been a great supporter for many, many years. So it's always great to be back on your show.

Good on you, John. Thanks, mate. I appreciate your time. But don't forget you can get John's report to use that link down below. Thanks, John. Thanks, Bushy. Thank you, guys. Great to meet you.

Thank you, guys. And make sure you stay with us here on Realty Talk because after the break, as Kevin has already mentioned, we're going to do a quick summary of the report, including a bit of a breakdown on what's happening in each of the East Coast major capitals. Stay with us. You're watching Realty Talk. Property deductions can save you thousands of dollars each year.

To make sure you maximise deductions, you need to work with the most experienced quantity surveyor in the country. BMT Tax Depreciation is the leading specialist in the industry. They've completed over 700,000 tax deduction schedules for residential investment and commercial properties Australia-wide. BMT guarantee to find double your fee in the first full financial year deductions. Call BMT on 1300 728 726 today for an obligation free quote. download. Just don't miss that opportunity. Bushy, let's duck around the country. We'll start at

Sydney. It's been a funny mix in Sydney, hasn't it? I mean, the biggest city in Australia and the prices are all over the place. Interesting that gap between houses and units really highlighted in the Sydney market in particular. Yeah, and I think John had sort of spoke to that pretty well in terms of the impact that COVID's had is that pushing people away from one, the CBDs, but two, into larger properties that are more flexible and therefore the housing demand has really blossomed, whereas the apartment market

has really struggled. Yeah, I think we saw growth, house price growth of 33% in 2020, peaking at $1.4 million. So, hey, just before we leave Sydney, John's top picks are Edgcliffe, Oatley, North Richmond, Balgala Heights and Jindabyne. You can get a detailed rundown on why he's chosen those when you download that report. Brilliant.

Well, let's jump into Melbourne now, Kevin, because it's fair to say that Melbourne really soared with post-pandemic optimism in the opening months of this year, but that has now come back and has lost a bit of a momentum. We're now seeing medium house prices around about the $950,000 mark and apartment prices about $600,000 or thereabouts. And this is due to a number of factors that they talk about in the report. One, less government stimulus with reopening of businesses and interstate borders, reduced housing affordability owing to the previous price surges and rising mortgage rates. However, I'd note that they describe in the report

that they're really seeing a bit of a two-speed market with values in regional Victoria remain quite buoyant. So, you know, we're seeing price growth in regional Victoria that's expected to wheeze in the months to come, but some areas are still on the rise where some of the larger regional centres like Geelong and Ballarat are starting to see declines. Interestingly, a couple of the suburbs I've talked about there, Kevin,

North Melbourne, close to the city, And one of the other areas that really picked up my eye was Point Lonsdale down in the Bellarine, where I'm actually currently taste testing and living as we speak. So we're still seeing a bit of a shift in terms of the regionalisation there. I've got to get down there and do a bit of taste testing with you too, mate. Just before we leave Melbourne, wasn't it painful to watch during COVID that huge lockdown they went through? And when you think about it, the pent-up demand, it was like opening the floodgates, and that created that two-speed market as well, I think, or added to it, Bushy. Yeah, I totally agree, mate. I lived through it, being down by the Maunee Peninsula during that time, mate, and we actually hold the world record for the longest lockdown anywhere around the globe, mate.

So interesting times. But tell us about the read on Brisbane. Yeah, Brisbane. John's made the point, too. It has to come down to the Olympics. I mean, the build-up to the Olympics, living in Brisbane or very close to the inner city part of Brisbane, you can see the amount of infrastructure that's going in.

Now, I read an article this morning about, you know, the underground tunnelling that's going on under Brisbane. It's massive what's going in. It's no wonder that the market here is doing so well. Hey, just on a side note, Bushy, you know, with the very tragic death of the Queen and, you know, the crowning scene of the King, King Charles III, the Gold Coast was the first region, I guess,

to actually name a street after King Charles. King Charles Street is now official in Paradise Point, so there's a little bit of a side note there for you. There you go. I didn't know that, mate. I just hope that the Queensland government don't strangle the golden goose a little bit with their recent interstate investor land tax grab that has been implemented.

It doesn't show any signs of changing, but surely common sense has got to prevail. There's so many people talking about it. You talked about it in this show last week. You know, it is crazy that they can't see that. And then, of course, they come up with another harebrained scheme, which is saying that granny flats and backyards are going to actually help with the rental.

They literally, Bushy, do not do their homework. You know, I think the people advising them, you know, are morons because they just don't think these things through. Can't believe it. No, very well said, mate. Well, I've shipped into Canberra and... You're talking about morons. Well, interestingly enough, because there's so many public servants and the government centre is in the ACT, Canberra has actually seen three years of really consistent exponential growth.

And it's now actually decoupled from the smaller capital cities to join both Sydney and Melbourne as Australia's most valuable property market, Kevin. And Canberra is now the second most expensive capital in the country with medium house prices over a million bucks, which is more than Melbourne. and medium apartment prices a bit over 600 grand. But although Canberra has seen these exponential price rises, based on the McGrath report, there's still lots of opportunity for future growth. And this is obviously given the underpinning of government employment

and the continued infrastructure spin, we're gonna see areas that have identified in the report like Denman Prospect and the Belconnen Tower Centre, just to name a couple, will increasingly show some future promise, Kevin. Yeah, and of course, with that great growth in Canberra, Bushy, a lot of people are reinvesting, you know, working. They've had massive growth. They're looking for other opportunities and probably gearing against their existing property and looking at investment properties, which will

be great for the rental market, of course. Absolutely. Absolutely. Let's jump to the Apple aisle. Kevin, what's your thoughts on Hobart? I tell you what, there's been so many predictions about Hobart and the Tasmanian market, over the last couple of years. Bushy, you know, we've been waiting for it to stop. It shows no signs of stopping, that's for sure. COVID, I think, played very much in the favour of Tasmania because I think some of their recent promotions have been come down

and get some fresh air or something along those lines. I think John points that out in his report. But, you know, and the state government there have been very good with some of their stimulus as well. So that's all added to it. But, you know, John's saying in his report that it's not going to slow down. No, well, there's no doubt that Hobart's had an absolutely stellar run over the last five years. And, you know, talking about the ripple effect or the bridesmaid effect that the McGrath Report focuses on, you know, I recently was down there having a look at the northwestern coast of Tasmania and agree with the McGrath Report

but Davenport in particular really is shaping up to be, you know, it's going through a major urban renewal program, the larger that's planned in regional Tassie, and that's likely to future-proof that area as Northwest Tourism Gateway. So plenty of opportunity there. Of the five areas that John highlighted in his report, that was the only one in the regional area. The other two, of course, in the two major cap cities of Hobart

in launceston uh he's he's pointed out uh in hobart sandy bay and kingston beach two beautiful locations i gotta say if you if you're gonna live somewhere you might as well live in a place like that and in launceston uh st leonard's and in invermay which i hadn't heard much about invermay but interesting reading there yeah yeah well we as you know kevin uh we're currently on the hunt for opportunities ourselves, and we've been having a good look in and around the Launceston area, given that there's still really good value. You can get very sizable properties for pretty good money

in that location. So I guess to bring that to a close, I totally agree with the reports reading that chaos creates opportunity. When we're seeing such widespread change with the COVID catalyst really opening up the field so that we're no longer just focusing on the CBDs, but now the infrastructure is allowing us to pretty much live and work anywhere. It's pretty exciting times as far as property is concerned, Kevin.

Absolutely, my friend. And, gee, it's been fun. I've enjoyed this, Bushy. Thanks for having me back on the show. You know, any opportunity to get and have a talk about my favourite subject, real estate, but particularly enjoyable to join John McGrath. Totally, mate.

Always love sharing that microphone with you, mate. and I'm very humbled to have the opportunity to be hosting the show. But that pretty much brings us to a wrap for this week's show. And a big thanks to our special guest, John McGrath. And while you're there, make sure you don't miss another episode

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from over 7,000 agents nationally. We are even going to find properties listed that you won't find anywhere else. So before we go, Kevin, we'll have another big thanks to realty.com.au, B&T Tax Appreciation, Apiro Marketing and DM Media for their ongoing support. And on behalf of Kevin and I, remember to always get invested and we look forward to seeing you again next week. Miss something in this week's show or want to catch up on past shows? Do it anytime at realty.com.au where we connect buyers, sellers and agents differently.