Melbourne Apartments vs Shares
In a recent study conducted by Oliver Hume in Melbourne, it showed that apartments and townhouses have outperformed the stock market over the last 30 years. In its report, in measured the return of apartments from September 1980 through to September 2010. The median price of Melbourne apartments rose by an average of 8.9% each year while he share market rose 7.7% on average per year.
They were quick to point out that if they had measured the result up until 2007-08 collapse a different storey would be told with the share market outperforming the property market. The key fact though is to show that over a period of time when there are dips in the economy; property is a safer more reliable investment that doesn’t react as quickly to poor economic news due to the perceived illiquid nature of the investment.
Oliver Hume also indicated that Adelaide and Sydney apartment prices did not perform as well as Melbourne with them increasing on average at 7.1% and 7.4% respectively over the 30 year period.
Andrew Perkins, national research manager of Research at Oliver Hume, said that at various points in the past three decades shares and unit prices intersected during market highs and lows. ”It just shows that the set-and-forget nature of property can provide less-spectacular returns but it also highlights the volatile nature of the ASX,” he said.
