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  • Will You Add? - How Professional Property Investors Interpret and Use Capital Growth Statistics

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    high capital growth because the cost to build a new property increases over time but it doesn’t mean that older properties will have the same capital gro
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    Understanding and using yearly price growth statistics in an area of interest is critical to making successful property investments decisions.

    Property price growth is usually expressed in terms of a percentage i.e., 10% to 25% or more over a period of a year. But, what does this really mean.

    Some property agents would have you believe that you will achieve great capital gains in an area with high capital growth.

    The problem with this is that capital growth figures are often skewed by new developments in the area of interest.

    An area that experiences a lot of new development will have a high capital growth because the cost to build a new property increases over time but it doesn’t mean that older properties will have the same capital grow

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    rty price growth is usually expressed in terms of a percentage i.e., 10% to 25% or more over a period of a year. But, what does this really mean.

    Some property agents would have you believe that you will achieve great capital gains in an area with high capital growth.

    The problem with this is that capital growth figures are often skewed by new developments in the area of interest.

    An area that experiences a lot of new development will have a high capital growth because the cost to build a new property increases over time but it doesn’t mean that older properties will have the same capital gro

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    me property agents would have you believe that you will achieve great capital gains in an area with high capital growth.

    The problem with this is that capital growth figures are often skewed by new developments in the area of interest.

    An area that experiences a lot of new development will have a high capital growth because the cost to build a new property increases over time but it doesn’t mean that older properties will have the same capital gro

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    t capital growth figures are often skewed by new developments in the area of interest.

    An area that experiences a lot of new development will have a high capital growth because the cost to build a new property increases over time but it doesn’t mean that older properties will have the same capital gro

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    high capital growth because the cost to build a new property increases over time but it doesn’t mean that older properties will have the same capital growth.

    Example;

    In Sydney, Australia, a suburb close to the city and on the harbour, Darling Point, experienced apartment capital growth of 68.7% in one year, 2003, but the average the trend has been 9.9% since 1991.

    Taking those figures literally means that the average price of apartments in the area has gone up 68.7% i.e., a unit that was $400,000 in 2002 has gone to $675,000 in 2003.

    This article may be used provided the resource box below is included. Does this mean that a unit that I purchased in 2002 in an older building went up by $274,800 in one year?

    The answer is no. It on

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