The Melbourne-based independent property research advisory firm Nyko Property has recorded a 90% increase in sales in the 2014 financial year on the back of a buoyant property market, says Director Bill Nikolouzakis.
“In particular, we had a very busy second half of the year (January-June) following the 46% increase in sales in the 2013 financial year, with demand from the SMSF sector playing a key role,” he says.
Nikolouzakis says that 69% of Nyko’s sales – predominantly townhouses and small apartment complexes in suburban Melbourne – were made by intermediaries in the financial services sector, continuing the strong spike in demand in 2013.
Nyko does not sell direct to the public, instead using 228 intermediaries of which 73% are in the financial services industry (mortgage brokers, accountants and financial planner) with the remaining 27% comprising local and international estate agents. [Nyko is establishing two offices in Indonesia in Jakarta and Surabaya.]
He says Nyko has identified two key factors for a big increase in demand from the financial advisory industry for these types of property:
- The financial services industry has started to embrace direct property as an investment option for their clients;
- SMSF trustees are becoming more attracted to residential property.
He says that although SMSF investment dropped slightly in the 2014 financial year to 28% compared with 36% the previous year, all the indications are that SMSFs will remain a significant influence in this market.
“This is not surprising. SMSF property investment is being driven by clients of accountancy and financial advisory firms and will continue to be a strong growth area for Nyko Property, despite the slight 8% drop in sales.
“While we might not see such a high increase in SMSF property investment as we did in 2013, we expect it to continue to be about 30% of our business.
“Remember that we saw a 17.2% increase in SMSF investment into residential property across the market in the 12 months to March 2014,” he says.
“One in seven Australians invest in property so financial planners, accountants and mortgage brokers are starting to understand their SMSF clients are investing in property – with or without their advice.
“For those advisors who can value add for their clients by ensuring they are giving strategic advice both in terms of the property acquisition itself, as well as how it dovetails with the client’s investment portfolio, will benefit from growing investor interest in residential property.
“When coupled with the comprehensive information Nyko offers clients on all aspects of property investment, it not only means the end consumer is getting a totality of advice about the investment but advisors can also be comforted by the fact they are acting according to the current regulatory framework,” Nikolouzakis says.
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