What you need to know to future proof your home | Kanebridge News
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What you need to know to future proof your home

Spoiler alert: flying cars or vacuum sealed meals are not on the menu

By Robyn Willis
Mon, Jan 23, 2023 9:35amGrey Clock 4 min

 It’s fair to say that the world has gone through a period of accelerated change in recent years. Aside from the significant impacts of COVID, the effects of climate change are becoming more evident and, as countries around the world look for alternatives to fossil fuels, many homeowners are beginning to understand the implications at home, in the form of rising energy prices and greater weather extremes.

For those contemplating renovating or completely rebuilding from scratch, the idea of future proofing your home is beginning to take hold. But what does it mean to create a home for the future?

In general terms, a future-proofed home is one that is designed for longevity, with enough flexibility and sustainability built into it to provide residents with a comfortable lifestyle for decades to come. This means creating spaces that are not only comfortable to live in but have low running costs without the need to dramatically upgrade or alter aspects over time.

For some, that can entail embracing new technologies, which may come with substantial upfront costs, while for others, the focus is very much on design.

For more stories like these, pick up a copy of Kanebridge Quarterly magazine here.

 Architect Caroline Pidcock says the beauty of future proofing through design is that anyone building or renovating can take steps to make it part of the construction process. Whether you  plan to stay put or you have one eye on resale, she says the principles of a sustainable lifestyle still apply.

“There are three things anyone can do, whether or not you’re embarking on a major building project,” she says. 

“Firstly, make sure the external building envelope is as well sealed and insulated as possible. Secondly, we need to understand and work with the sun – where we want it and don’t want it – and work with it to capture its energy for our own use.”

The third measure, she says, is to step away from fossil fuels such as coal-fired power and gas, towards renewable sources of electricity.

“You should totally electrify your home,” she says. “Having a gas cooktop is like having a smoker in your home. If we totally electrify and make the building envelope as efficient as possible, we’re on the way to future proofing.”

In terms of design, Pidcock says it’s time to rethink the open plan living model in favour of more flexible spaces that can be opened up and closed down to allow for more efficient heating and cooling as well as better thermal and acoustic comfort for everyone.

“We need to rethink how much space we need,” she says. 

“That might mean the end of the open plan living dream. Adding doors is good from a thermal and acoustic point of view and the ability to close or open the spaces as you need them. 

“That flexibility of space is useful and important.”

This house designed by CarterWilliamson Architects is designed for flexibility and thermal comfort. Picture: Anson Smart

For Dr Trivess Moore, senior lecturer in RMIT’s School of Property, Construction and Project Management in Melbourne, the focus is very much on the ability of current housing stock to cope with the climate extremes many Australians are already experiencing.

“The majority of existing and new housing in Australia is not suitable for performing in our current climate,” he says. “This means we have a high reliance on mechanical heating and cooling to stay thermally comfortable, resulting in high energy consumption and bills. 

“The majority of the housing stock performs between 1.5 to 3 stars on a scale of zero (worst) to 10 (best). In some cases, households will find their housing unliveable for periods of time if we see climate change much further.”

Government regulation, such as the Building Sustainability Index (Basix) legislation introduced in NSW in 2004, has gone some way to make new housing stock more future proofed, says Moore, as have rebates to encourage Australians to take up renewable energies such as solar panels. The result is that one in three Australian households have installed solar panels, according to figures from the Clean Energy Regulator, the highest domestic uptake rate in the world. 

While battery storage systems are still prohibitively expensive for many, all indicators are that they will be a necessary part of any future proofed home, thanks to their ability to store energy from renewables to be used on demand.

Managing diretor of Qcells Australia, Jin Han says the sooner you can install a storage battery, the sooner you can make the most from solar energy supplies generated on your own property. He says there are options for those who would like to avoid the initial outlay.

“This can be addressed with green loans and financing,” Han says. 

The future of car use is electric, with home battery storage a given.

Qcells has partnered with Arcstream financing, allowing homeowners to bundle monthly payments with their energy plan. 

“For example, before solar your bill is $200 per month, add solar and battery and energy plan with no upfront payment, and pay $180 per month consistently, and be paying off an asset that you then own.”

Even some volume home builders are now offering battery storage packages and EV charging points.

Managing director of Volkswagen Group, Paul Sansom says once drivers move past concerns about ‘range anxiety’ for their cars, homes and residences equipped with EV charging stations will quickly become more desirable.

“Neither new houses nor new apartment buildings will be feasible without easy access to renewable EV charging; no more so than a home without internet access,” he says.

Further proof that the future of living is already here.


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A new trading year kicked off just weeks ago. Already it bears little resemblance to the carnage of 2022.

After languishing throughout last year, growth stocks have zoomed higher. Tesla Inc. and Nvidia Corp., for example, have jumped more than 30%. The outlook for bonds is brightening after a historic rout. Even bitcoin has rallied, despite ongoing effects from the collapse of the crypto exchange FTX.

The rebound has been driven by renewed optimism about the global economic outlook. Investors have embraced signs that inflation has peaked in the U.S. and abroad. Many are hoping that next week the Federal Reserve will slow its pace of interest-rate increases yet again. China’s lifting of Covid-19 restrictions pleasantly surprised many traders who have welcomed the move as a sign that more growth is ahead.

Still, risks loom large. Many investors aren’t convinced that the rebound is sustainable. Some are worried about stretched stock valuations, or whether corporate earnings will face more pain down the road. Others are fretting that markets aren’t fully pricing in the possibility of a recession, or what might happen if the Fed continues to fight inflation longer than currently anticipated.

We asked five investors to share how they are positioning for that uncertainty and where they think markets could be headed next. Here is what they said:

‘Animal spirits’ could return

Cliff Asness, founder of AQR Capital Management, acknowledges that he wasn’t expecting the run in speculative stocks and digital currencies that has swept markets to kick off 2023.

Bitcoin prices have jumped around 40%. Some of the stocks that are the most heavily bet against on Wall Street are sitting on double-digit gains. Carvana Co. has soared nearly 64%, while MicroStrategy Inc. has surged more than 80%. Cathie Wood‘s ARK Innovation ETF has gained about 29%.

If the past few years have taught Mr. Asness anything, it is to be prepared for such run-ups to last much longer than expected. His lesson from the euphoria regarding risky trades in 2020 and 2021? Don’t count out the chance that the frenzy will return again, he said.

“It could be that there are still these crazy animal spirits out there,” Mr. Asness said.

Still, he said that hasn’t changed his conviction that cheaper stocks in the market, known as value stocks, are bound to keep soaring past their peers. There might be short spurts of outperformance for more-expensive slices of the market, as seen in January. But over the long term, he is sticking to his bet that value stocks will beat growth stocks. He is expecting a volatile, but profitable, stretch for the trade.

“I love the value trade,” Mr. Asness said. “We sing about it to our clients.”

—Gunjan Banerji

Keeping dollar’s moves in focus

For Richard Benson, co-chief investment officer of Millennium Global Investments Ltd., no single trade was more important last year than the blistering rise of the U.S. dollar.

Once a relatively placid area of markets following the 2008 financial crisis, currencies have found renewed focus from Wall Street and Main Street. Last year the dollar’s unrelenting rise dented multinational companies’ profits, exacerbated inflation for countries that import American goods and repeatedly surprised some traders who believed the greenback couldn’t keep rallying so fast.

The factors that spurred the dollar’s rise are now contributing to its fall. Ebbing inflation and expectations of slower interest-rate increases from the Fed have sent the dollar down 1.7% this year, as measured by the WSJ Dollar Index.

Mr. Benson is betting more pain for the dollar is ahead and sees the greenback weakening between 3% and 5% over the next three to six months.

“When the biggest central bank in the world is on the move, look at everything through their lens and don’t get distracted,” said Mr. Benson of the London-based currency fund manager, regarding the Fed.

This year Mr. Benson expects the dollar’s fall to ripple similarly far and wide across global economies and markets.

“I don’t see many people complaining about a weaker dollar” over the next few months, he said. “If the dollar is falling, that economic setup should also mean that tech stocks should do quite well.”

Mr. Benson said he expects the dollar’s fall to brighten the outlook for some emerging- market assets, and he is betting on China’s offshore yuan as the country’s economy reopens. He sees the euro strengthening versus the dollar if the eurozone’s economy continues to fare better than expected.

—Caitlin McCabe

Stocks still appear overvalued

Even after the S&P 500 fell 15% from its record high reached in January 2022, U.S. stocks still look expensive, said Rupal Bhansali, chief investment officer of Ariel Investments, who oversees $6.7 billion in assets.

Of course, the market doesn’t appear as frothy as it did for much of 2020 and 2021, but she said she expects a steeper correction in prices ahead.

The broad stock-market gauge recently traded at 17.9 times its projected earnings over the next 12 months, according to FactSet. That is below the high of around 24 hit in late 2020, but above the historical average over the past 20 years of 15.7, FactSet data show.

“The old habit was buy the dip,” Ms. Bhansali said. “The new habit should be sell the rip.”

One reason Ms. Bhansali said the selloff might not be over yet? The market is still underestimating the Fed.

Investors repeatedly mispriced how fast the Fed would move in 2022, wrongly expecting the central bank to ease up on its rate increases. They were caught off guard by Fed Chair Jerome Powell‘s aggressive messages on interest rates. It stoked steep selloffs in the stock market, leading to the most turbulent year since the 2008 financial crisis. Now investors are making the same mistake again, Ms. Bhansali said.

Current stock valuations don’t reflect the big shift coming in central-bank policy, which she thinks will have to be more aggressive than many expect. Though broader measures of inflation have been falling, some slices, such as services inflation, have proved stickier. Ms. Bhansali is positioning for such areas as healthcare, which she thinks would be more insulated from a recession than the rest of the market, to outperform.

“The Fed is determined to win the war since they lost the battle,” Ms. Bhansali said.

—Gunjan Banerji

A better year for bonds seen

Gone are the days when tumbling bond yields left investors with few alternatives to stocks. Finally, bonds are back, according to Niall O’Sullivan of Neuberger Berman, an investment manager overseeing about $427 billion in client assets at the end of 2022.

After a turbulent year for the fixed-income market in 2022, bonds have kicked off the new year on a more promising note. The Bloomberg U.S. Aggregate Bond Index—composed largely of U.S. Treasurys, highly rated corporate bonds and mortgage-backed securities—climbed 3% so far this year on a total return basis through Thursday’s close. That is the index’s best start to a year since it began in 1989, according to Dow Jones Market Data.

Mr. O’Sullivan, the chief investment officer of multi asset strategies for Europe, the Middle East and Africa at Neuberger Berman, said the single biggest conversation he is currently having with clients is how to increase fixed-income exposure.

“Strategically, the facts have changed. When you look at fixed income as an asset class…they’re now all providing yield, and possibly even more importantly, actual cash coupons of a meaningful size,” he said. “That is a very different world to the one we’ve been in for quite a long time.”

Mr. O’Sullivan said it is important to reconsider how much of an advantage stocks now hold over bonds, given what he believes are looming risks for the stock market. He predicts that inflation will be harder to wrangle than investors currently anticipate and that the Fed will hold its peak interest rate steady for longer than is currently expected. Even more worrying, he said, it will be harder for companies to continue passing on price increases to consumers, which means earnings could see bigger hits in the future.

“That is why we are wary on the equity side,” he said.

Among the products that Mr. O’Sullivan said he favours in the fixed-income space are higher-quality and shorter-term bonds. Still, he added, it is important for investors to find portfolio diversity outside bonds this year. For that, he said he views commodities as attractive, specifically metals such as copper, which could continue to benefit from China’s reopening.

—Caitlin McCabe


Find the fear, and find the value

Ramona Persaud, a portfolio manager at Fidelity Investments, said she can still identify bargains in a pricey market by looking in less-sanguine places. Find the fear, and find the value, she said.

“When fear really rises, you can buy some very well-run businesses,” she said.

Take Taiwan’s semiconductor companies. Concern over global trade and tensions with China have weighed on the shares of chip makers based on the island. But those fears have led many investors to overlook the competitive advantages those companies hold over rivals, she said.

“That is a good setup,” said Ms. Persaud, who considers herself a conservative value investor and manages more than $20 billion across several U.S. and Canadian funds.

The S&P 500 is trading above fair value, she said, which means “there just isn’t widespread opportunity,” and investors might be underestimating some of the risks that lie in waiting.

“That tells me the market is optimistic,” said Ms. Persaud. “That would be OK if the risks were not exogenous.”

Those challenges, whether rising interest rates and Fed policy or Russia’s war in Ukraine and concern over energy-security concerns in Europe, are complicated, and in many cases, interrelated.

It isn’t all bad news, she said. China ended its zero-Covid restrictions. A milder winter in Europe has blunted the effects of the war in Ukraine on energy prices and helped the continent sidestep recession, and inflation is slowing.

“These are reasons the market is so happy,” she said.

—Justin Baer


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Sydney city skyline with inner suburbs of Glebe and Pyrmont, Australia, aerial photography

Predicted increases in value signals strength in local property market.

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