More investors think property will outperform shares: Survey

Amid deteriorating confidence about the economic outlook, Australian investors now expect their property assets to outperform their share portfolios. 

Only a quarter (26.5%) of the 820 investors surveyed by research house CoreData believe shares will outperform residential property over the next quarter of 2011, compared with more than half (55%) who believed so in the second quarter. 

Investors believe all investments, apart from residential property, will perform worse in the next three months. 

In terms of value, residential property has the greatest worth among the investments held and savings has the least, the survey found. 

The affinity for property is not surprising, with 44% of investors saying not holding enough assets makes them feel insecure. 

More than a half (55%) are worried about not earning enough money and 45% are worried about paying off their debts. 

Overall, the survey uncovered a dramatic fall in investor sentiment in the third quarter with the index now sitting at -21.7, a drop of 15.7 points. 

Investor sentiment is now at its lowest level since the first quarter of 2009. 

“Australians are clearly panicking and preparing for tough times ahead,” says CoreData head of advice, wealth and super Kristen Turnbull. 

“They are shaken by the recent US and European debt crisis and are concerned over the fallout of economic uncertainty.” 

Eighty per cent of respondents predict an economic slowdown over the coming quarter. Investors have become much more negative about business conditions with 68% of respondents expecting them to deteriorate, up from 44% last quarter”. 

The survey uncovered negative sentiment towards business and economic conditions from all demographics, with women more concerned than men. 

Other findings from the survey: 

  • Superannuation funds (69%) and savings accounts (65%) remain the most commonly held investments, followed by direct shares (36%). 
  • Three out of 10 investors are most likely to rebalance towards cash over the next quarter.

Larry Schlesinger

Larry Schlesinger

Larry Schlesinger was a property writer at Property Observer

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