Among many per year, I recently attended a seminar late last year, in regards to real estate and, more accurately, strategies on building wealth through real estate. Now before reading on, keep in mind it wasn’t for the people attending (brokers, real estate agents, financial planners, etc) it was information to be passed on to clients. If they were to use the same strategies the choice was their own.
In a nutshell, the seminar was showing how in the long run real estate seems to never lose value. More conclusively land. Houses in the long run will depreciate, as will cars, however, stats and history show land is king when looking at growth.
For example, let’s look at 1986 to 2016 – a simple 30 year history in the Australian property Market. Apartments in 1986 were averaging $67,000 with the average house being $87,000 and land $16 per square metre. Fast forward to 2016 where the average apartment was $440,000, house $695,000 and land $620 per square metre. Let’s be more accurate…
Apartments have increased 556%
Houses have increased 699%
Land has increased a whopping 3,775%
There are numerous reasons for this result, especially with an ever growing population, however, these are facts proving numbers don’t lie and land is king.
In conclusion, the answer between Real Estate and Property is this: Real Estate is LAND and Property is the house. Both appreciate extremely well, however, as my example shows one clearly appreciates a lot more than the other. When you enter into your next property purchase, it would be wise to always consider the land value content before moving forward.