Linz’s Friday Musings – September 6th 2019

G’day all 

Happy Friday and good luck to <insert your footy team here>! 

Footy finals, warmer weather, sunshine, what’s not to like about Spring! 

I know there are certain parts of the US that have been under siege from hurricane Dorian, particularly Florida, Virginia, South Carolina etc, and by reports, appears to be a real monster.  I often do get asked how natural disasters and storms etc can affect markets, and the truth is, then can in some circumstances. 

Depending on the amount of damage caused, costs etc, economists would be looking to predict the damage to the GDP of the US economy.  In particular areas, if hit hard, the homes damaged/lost will also have a real impact on property prices in that area for a period of time afterwards. 

There would be extensive work going on afterwards to renovate, rebuild homes damaged, clear destroyed homes and rebuild and this can force pricing up for contractors and construction with so much workload.  Further, there can often be a large number of homes go on the market, damaged where the owners had no insurance, no funding to fix, and have to sell and walk away.  This can often put a glut of properties onto the market and keep housing prices low. 

Truth is though, this is all relatively localised where areas were effected and doesn’t really affect the market as a whole.  As I was discussing last week, we are never really looking for signs to be all perfect, no “storms on the horizon” before investing.  Within every adversity can be a real opportunity if we look for it 

When you change how you see things, the things you see change… 

In the meantime, we pray for the residents on the east coast of the US and the Bahamas to stay safe and hope that Dorian heads back off shore. 

Have a great weekend all, and happy investing!!