The Real Olympic Games Winners
The winner is Sydney….
These words become iconic after being uttered by President Juan of the IOC in September 1993.
Most of us probably don’t realise it was that long ago, I didn’t.
Looking back with hindsight, the cost for Sydney to become an Olympic city was $5 billion dollars. A significant amount in the 90’s, and a sign of things to come for Brisbane, it now seems.
Olympics are a ‘Hero’ event and sought after by many counties that want the exposure and fame. Being forefront on the world stage is a legacy coveted by most politicians.
However, when the Olympics come to town, the winners are not the athletes.
It is the land holders, via economic rent
With events this large, the focus turns to infrastructure, especially physical infrastructure. Roads, stadiums, medical facilities, accommodation and much more, has billions of dollars thrown at it.
And this is done in the lead up to the event, not after.
What does this have to do with property?
Your private purse can benefit big time from this event by harnessing the power of the public purse and its spending.
Infrastructure spending is not grants, or payments, or a program. It is permanent and bankable.
The facts stand
If government spends money on infrastructure in an area, median house process rise.
In fact the total rise in house values far outweighs the amount spent. This report from the UK studied rail lines and the effect on property prices. It came up with a blended average of 242% increase.
Meaning, that for every $1 spent on infrastructure, property in the surrounding areas, collectively in value, rose a corresponding $2.42 of total value. (The report found instances of projects causing an increase in collective property values of between $1 and $5 for every $1 of infrastructure spend.)
Or in the case of Sydney, the $5B in spending may have meant that properties benefiting from the new infrastructure, had a total value increase of $12.1B.
(It should be noted that this report’s findings were from the infrastructure alone, not the normal market price movements etc)
Finding accurate figures on Olympic spending is not a basic task as there are many ways to break it down. Brisbane announced it has a budget of $5B to host the games (we all know how well budgets are adhered to) not including the $8B in other infrastructure spending already planned from Federal Government, and possibly not the $1B already planned by QLD.
Using those figures in a ‘best case’ scenario it would equate to $14B in spending total.
Will this give Brisbane property owners, and South East QLD where other events are held, a corresponding gross combined uplift of $33.88B?
Perhaps it will be more, or perhaps less.
Either way, when the government has its purse open and throwing money around, you would be crazy to not take advantage of it.
If you want to secure your financial future using property, then contact us here or call now on 1300 66 77 89.
Since 2004, Scotty North has been helping people buy the best properties for their needs at prices that simply speak for themselves.
Scotty has been instrumental in bridging the gap between financial planning and traditional real estate transactions through his property advice model.
Scotty North is a Qualified Property Investment Advisor (QPIA), with accreditation’s in financial planning, mortgage broking and real estate.
By carefully considering his clients’ goals and planning for market changes via demographics and trends, Scotty designs a future proof outcome not only specific to the client’s needs but dynamic in its execution with performance indicators and exit strategies built in.
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