18 MONTHS AFTER COVID-19

by Anthony Rous, Chief Financial Officer, Kennards Self Storage

Well, here we are in June 2021 and it’s almost a year and a half ago the entire planet went into lockdown in confusion about a worldwide pandemic.

What a difference 18 months makes. Each of our Australian states and territories along with New Zealand have been through different lockdowns of varying lengths and restrictions. In Australia we have fared far better than most of the world and things are starting to look and feel positive… or are they?

Should we be concerned or getting the champagne out? Here are some indications from the wider economy and globally: l The USA has just delivered a massive $1.9 trillion support package which will be a massive boost to the entire worlds’ economy. It will be a bit of a sugar hit but will certainly boost the worlds’ economy. l China had positive growth in the year to December 2020 and is forecast to grow at around 10% in 2021 – this is a very good sign for the world and in particular for Australia who supplies many raw materials and minerals, specifically iron ore which accounts for just over half of all Australian exports. l Vaccines are being rolled out across the world and significant reductions in cases and hospitalisation is being seen.

Hospitals are freeing up spaces for other medical events which takes enormous strain off the medical sector. l Australian property prices are expected to grow approximately 10% for the next two years.

Great for owners but harder for buyers to get into the market. This is mainly for single dwellings and not apartments where there is some oversupply. New

Zealand are also seeing surging property prices. l Interest rates are at all-time lows. The Reserve Bank of Australia are saying rates will not go up until 2024. The US have also locked in interest rates at zero until at least 2023. l Australia has seen a massive reduction in tourists however, we do spend $30 billion more on overseas travel than tourists spend within Australia. So, while international borders are closed and hopefully domestic borders do not close again, the spending by locals in

Australia will far outweigh the loss of tourist dollars. l Business confidence is at a 10 year high which is a sign of optimism and encourages people and businesses to spend. l Great rains have delivered bumper farming crops across the country and with follow up rains, things are looking good. l Australian savings are at an alltime high. Cash balances are available to be spent to boost the economy, despite most

Government support stopping at the end of March. l Some issues being faced are exports to China no longer being accepted. New markets for items like coal and barley have already been found and areas like wine looking for new market. l Students are a concern for the entire industry and also associated residential study programs like MBA’s etc. Based on all of the above factors it appears things are looking positive and Australia and New Zealand should fare well in the next few years. We should therefore feel fairly optimistic and positive about the future and look to enjoy our return to ‘normal’ life, whatever that looks like.

Pull up a storage box and toast yourselves to getting through an incredible 18 months. Hopefully many positive events and experiences such as travelling and reuniting with family and friends are in the near future. l

“Business confidence is at a 10 year high which is a sign of optimism and encourages people and businesses to spend.