PZ> Another thing to watch out for is the property 
 PZ> market. Interest rates
 PZ> are on the way up - and incomes are not headed 
 PZ> that way. I expect to
 PZ> see some distressed sales in about 2 years time.

 BM> Yes.  Residential property is not so great now that 
 BM> inflation looks like
 BM> being low for quite a few years and the demographics of our population
 BM> will slow down household formation.  Unless you go to Queensland, that
 BM> is.   Commercial is still good, but you need big 
 BM> whacks of money to get
 BM> set.  Forget about partnerships and strata title offices/shops.

 
Some of the commercial listed property trusts are yielding about
10% with minimum risk in the underlaying assets - although like
bonds the market could always discount the price.
 
I'm thinking of trusts like Property Income Investment Trust and
Prime Credit. These both have new buildings and long term leases
with the ATO. They also have an annual rental review (PII anyway).
Rent goes up the maximum of inflation or the market rate, and can
never go down. I see these as an income investment alternative
to bonds etc. with the prospect of modest capital gains, while
income keeps pace with inflation.
 
Since bond rates have gone up their prices have fallen slightly,
but they have lower volatility than the market in general.
 
LM

--- Maximus/2 2.01wb