Say what you like about the boom in home prices but you should see what the rest of property is doing.
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How about a 30 per cent rise in a year? Or 53 per cent over five years? Not even Sydney or Melbourne could beat that.
Well, that's not entirely true since they house, so to speak, most of the commercial properties behind this surge in listed property trust prices.
I'm wondering whether all those investors who are ploughing into residential properties and upsetting in equal parts the Reserve Bank and first home buyers, might have caught the bus to the wrong bubble.
They wouldn't be getting anywhere near the rental yield that listed real estate investment trusts (REITs) earn – and higher still for unlisted ones – nor the contractual certainty of long-term tenancies.
Worse, they're more than likely putting all their eggs in one basket. It's not as if you can flog off the bathroom to take some profits or raise some quick cash should you suddenly need it.
When you think about it, a pooled real estate investment is safer than a house or unit even if it trades on the ASX.
After all, you're getting scale and diversification with the bonus of not having a mortgage.
Yes, I know REITs are susceptible to the market's often mad moments and certainly let the side down in the aftermath of the global financial crisis.
They had too much debt back then. This time they've shot ahead of the value of their properties, though who knows what that really is since it's the projection that counts.
The surviving REITs are less geared, less likely to be involved in property development and, with honourable exceptions such as Westfield and Goodman Group, are prone to fewer forays offshore.
Like housing, falling interest rates are a boon to REITs which pay about 5 per cent. True, they don't come with franking credits, but neither does a house.
As their borrowing costs fall and earnings rise, the value of their properties increases thanks to what's known as a capitalisation or cap rate.
That's the market's valuation of the net return from rents. It works that out by taking the risk-free 10-year bond yield and adding a premium. Bond yields have crashed to not much more than 2 per cent and dragged cap rates down with them, so the property is worth more.
For residential REITs like Mirvac or Stockland it's even better: low rates boost the demand for new housing as well.
Best of all, though, REITs are the real winners from the weaker dollar. If you think foreigners are snapping up the best homes, you should see what's happening to offices and warehouses.
A 6 or 7 per cent yield in the CBD is twice that in New York or London and the weak dollar just makes them look even cheaper in foreign currencies.
In fact foreign investors are buying up city office blocks and converting them to apartments, a sort of property double dip.
The story Real estate investment trusts offer high returns for investors first appeared on The Sydney Morning Herald.