Adjusting property value growth for inflation

Brisbane has been the weakest performing capital city market over recent times with property values down -7.3% from their March 2010 peak. When the results are adjusted for inflation, the fall in values from the March 2008 peak is much more pronounced at -12.3%. Similarly in Perth, the fall from the market peak is more than double (-5.4% versus -11.3%) when the results are adjusted for inflation.

On the flip-side these conditions are likely to impact on negatively geared investors. Given this, RP Data anticipates that investor activity is likely to remain relatively subdued and those investors which are active in the market are likely to have a much greater focus on yield maximisation rather than negatively geared properties. At least for the short term, investors chasing substantial capital gains are likely to be disappointed given the anticipated market conditions.

Source: RP Data Property Pulse

Misleading Advertisement for Pulse

Here is text of an advertisement for the Pulse off-the-plan apartment complex:

"Best Value Apartment in Brisbane CBD. This 2 bedroom 2 bathroom inner city apartment located in the heart of Brisbane CBD is an unbelievable $499,000."

Advertisement by Martin Graham from Property Focus.

I am not sure how an apartment building that is almost in Milton could be said to be in the "heart of the Brisbane CBD"! Have a look at the photo from the advertisement -- you can't even see the CBD. This complex is close to Milton Road, Coronation Drive and with views of the Inner City By Pass.

And on what basis is this the best value 2 bedroom apartment in Brisbane??

Take care, because FKP's complex next door to Pulse (Vue) has had capital decline, not capital growth.