MARK Steinert remembers "walking through zombie land" the day US financial powerhouse Lehman Brothers collapsed in 2008.

The former UBS global head of real estate research, now managing director and CEO of property group Stockland (ASX:SGP), likened it to "watching a crash in slow motion".

"I remember going home, walking through NYC it was like walking through zombie land. People were walking in a daze as they were trying to grasp what was going on."

Steinert, addressing a Bond Business Leaders Forum on the Gold Coast, says the investment landscape has changed dramatically since those heady days, with the low interest rate environment making for a renewed focus on income assets.

He says property, often maligned and "undercooked" by many commentators, is playing a pivotal role in this new era.

"What's changed in the past decade, compounded by an ageing demographic in the developed world, is a continuing focus on income," Steinert says.

"Particularly in a very low interest rate environment that is likely to be lower for longer, it is pushing, driving and directing investment towards real estate and infrastructure."

Steinert says the drive has been so strong that central banks, along with traditional investors such as pension funds and institutions, hold an allocation in real estate.

"That's a massive change. It's only really happened in the last six or seven years. It's not uniform yet but it is a viable trend. Prices are shifting, and they are shifting aggressively."

Steinert sees property yields coming down another percentage point in Australia, equating to house price rises of 10 to 15 per cent. However, he also sees underlying demand continuing to support the current upswing in supply, describing it as a catch-up following two years of flat construction in the aftermath of the GFC.

Australia remains appealing for offshore investors with yields of about 5 to 6.5 per cent compared to 3.5 to 4.5 per cent for the same assets overseas.

However, Steinert is blunt when it comes to suggestions that a bubble is developing.

"It's an environment where you have to remain disciplined (but) the idea that nationally there is a horsing bubble at the moment is ridiculous.

"There is no evidence that there is a consistent level of increased housing values across the country.

"Where it is hot is in Sydney and also inner Melbourne. Perth is flat and will remain flat for the next few years.

"Brisbane is starting to rise, but the spread between Brisbane house prices and Sydney is the highest it's ever been because the population growth isn't there.

"You're not seeing the big net interstate migration numbers (to Queensland). That's because you have retirees chasing the sun and you have people moving south chasing jobs. It will be very important that Queensland is able particularly to create jobs because jobs is where it begins and ends."

Steinert says fears of an oversupply amid the current development surge should be put into perspective.

"The (Australian) population is growing at 37,000 people a month through immigration and natural growth, which means 14,000 homes a month are needed to house them. If we are going to be anti-development we are going to have serious problems."

He says Sydney still has a five-year undersupply, driven in part by strong overseas migration.

"Where it's really diverse is in the regions. We've all read about Port Hedland and the fibro house that sold at the peak of the boom for $1.2 million. It just traded a few weeks ago for $250,000. Clearly someone lost a lot of money."

Steinert, who took on the top job at Stockland in 2013, laments what he sees as a misunderstanding by the broader community of the importance of the property sector, which in Australia is worth $6 trillion based on the current valuation of investment in real estate. This compares with the national economy which is worth $1.4 trillion.

Steinert points to the property sector being the economy's single greatest taxpayer, forking out $34 billion a year, employing 1.3 million people, or 13 per cent of the total workforce, and accounting for 11.5 per cent of Australian GDP.

"Real estate in many ways has undercooked its presence in the community more broadly," he says.

"We think there is a better way of doing things we think through a sustainable, insightful and exciting development that does think about community you can create a higher standard of living.

"In our country people don't want development. They want to see things stay exactly as they are. Human beings hate change. Change does bring a net benefit; it's about the art of moving a society forward and moving an economy forward and keeping the ecosystem sustainable."

Stockland is the largest residential developer in Australia, controlling about 80,000 lots of land with a development value of $20 billion. It is also a top five shopping centre owner and a major investor in aged care living.

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