2018 Year in Review

Posted by Dominic Cavagnino

So, as we draw a close to 2018, it’s only fitting to reflect on the year it’s been.

For many, 2018 has been challenging. We have seen the tightening of the banking environment as a result of the Royal Commission, the slow-down in the Sydney property market and the many other hurdles along the way.

In true Blue Wealth style, we’ve looked to find the best ways to capitalize on the tougher market. Turning the tables in our favour, we utilized our position as a market leader to negotiate some of the best opportunities for our clients, that we’ve ever seen.

Whilst the year has presented its challenges, it’s been a very successful one for us. So, here’s what we’ve been up to:

Acquisition

Project Approvals

In 2018, the research and acquisition team only approved nine new projects after reviewing well-over 150 projects. Seven of our nine approved projects were in Melbourne as we decided to proactively seek out opportunities in Melbourne’s north-eastern corridor.

Approved Locations

Our focus on the north-east led our clients and staff to invest in Alphington, Heidelberg and Ivanhoe. This corridor can be characterized by its value and growth potential, with numerous key infrastructure projects underway which are likely to unlock the potential of the region and close the gap between these suburbs and their southern counterparts.

Key Indicators

Last week we discussed the importance of the house unit gap (HUG) and how this has been a strong driver for our market selection over the last two years. This was also a key driver for our market selection this year. The unsustainable gap between house and unit prices is evident in all of our approvals in 2018.

The gentrification and suburb evolution were also influential in our selection. Collingwood and Preston, both presenting the characteristics of an evolving suburb were important considerations prior to their approvals.

First and foremost, our focus this year has been value. The current market has worked in our favour in allowing us to negotiate much harder and provide our clients with properties priced below market values.

Research

From a research perspective our focus this year was to better disseminate the research which we’re conducting. This year, we’ve produced two research articles each week, providing our clients with more up to date property market knowledge and providing our business partners with more resources to help them to educate their clients.

We’ve introduced a more comprehensive project communication schedule for our clients. These updates come in all different forms and occur monthly ensuring more frequent communication for all our investors:

Construction Updates
Suburb Updates
Suburb Facts

Deep Value Analysis (DVA)

We’ve also tried to better present the extensive research we do into the value proposition of individual projects. Our ‘Deep Value Analysis’ (DVA) is a document which includes over 8 – 10 comparable sales and uses a calculation method to determine the fair value for a Blue Wealth approved property. The DVA is available for all projects which have been approved this year and if you’d like to view one, we are happy to provide this to you.

That’s a wrap for 2018, we hope you’ve had a great year and are looking forward to a happy and safe Christmas & New Year. We look forward to seeing you in 2019.

Posted by Dominic Cavagnino, on 18th Dec 2018