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COVID-19 Proof Markets: Do they really exist?

Stability is referred to as the strength to stand or endure and according to Suburbanite Principal, Anna Porter, despite COVID-19’s efforts to take down some property markets, there are still some stable ones.

With the share market being so volatile, and the returns on invested cash being so low, property is a very stable option for many investors.

The former valuer and market commentator believes for those who own a property during COVID, this is the exact sort of investment you want to have in turbulent times.

“Bricks and mortar are what people go back to when they are uncertain,” said Porter.

“They can touch it, feel it, see it and most importantly, understand it.”

There are two Australian markets that are COVID resilient, Adelaide and Canberra.

“They’re both backed by major infrastructure, more stable employment and Canberra in particular is getting some premium pricing due to a lack of stock pushing though the COVID conditions,” said Porter.

“This is a very different story to take Darwin for example,”

“I know investors that bought DHA property there 5 years ago and it is now worth $200,000 less than what they paid for it!”

“Instead, I have always focused on stable fundamentals like infrastructure projects, employment diversity, strong rental markets and population growth for our investors. Because of this conservative and measured approach to investing, our investors property values have remained very stable even in turbulent market times and while many other markets have been crashing, ours have not.”

Adelaide is set up to come through COVID with strength and stability because of the same things Porter was looking for when her team strategically selected Adelaide to buy in, they include;

  1. Largest Hospital project in the country at $2.4B, opened its doors end of 2018
  2. Military boat project – creating employment
  3. Upgrade to the Casino – construction jobs & nightlife
  4. Still growing their Tech sectors through Government incentives and assistance to business

“Adelaide is, and will remain, a growing economy,” says Porter.

“This creates stability in the market and overtime that will filter through to the property market,”

“It is well poised to come out of COVID with strength.”

Porter reflects on a recent buying experience in Canberra, also indicating there is still stability in the Canberra market.

“Our property team missed out on buying a house in Canberra this week as it had an opening offer at the first open a whopping $35,000 over the asking price on a $650,000 purchase,” she says.

“That’s 5% over on the first open, who said that COVID was impacting property prices in Canberra?”

Ms Porter has been buying in the area for over 2 years and the drivers that she saw when she started buying there 2 years ago are still in play and are helping the Canberra market remain stable when some other markets are struggling to stay afloat.

Canberra investors should also be confident that they are positioned well to ride out the COVID economy.

Porter likes stable investments and things that aren’t too volatile or risky.

“The types of investments that can be particularly volatile during a COVID economy include shares, large scale property development, cash in the bank )returns are so low), lending money to friends, lending money to friends who are developers (oh dear), Airbnb or other tourism based property, serviced apartments and retail,” said Porter.

“What I consider to be a stable or low risk investment during COVID-19 is shares in ZOOM and residential property.”