COVID cliff? Spring-back? Or something else?

Where are we now? And what are the experts telling us? And what will happen after Job-keeper winds up?

Despite challenging conditions, house prices are holding up surprisingly well…for now…

Since our last blog, it appears that we may be starting to see some light at the end of the Coronavirus tunnel.

It is pleasing to see that the rate of infection with Covid-19 in Australia is remaining relatively stable at very low levels. With limited community spread, the lockdown is finally beginning to ease. Several states have been reporting zero daily infections and the push is now for state borders and the trans-Tasman border to reopen, and for domestic economic activity to ramp back up.

The stock market is down, unemployment is up, and the country is on Government life support during lockdown.

But what’s happening to the property market?

It’s hard to believe that only four weeks ago, our stock market was close to an all-time high, and auctions were drawing record crowds and prices.

As you are well aware, stock markets have plummeted with panic selling, the world is heading for global lockdown and the news on COVID-19 gets worse every day.

Each quarter we survey a number of real estate agents across Melbourne for their views on the current property market and what they expect in the next three months.

In our last survey, they made the gutsy call of a 4-5% price increase for the December quarter. Guess what - they were right!

The average Melbourne property price rose by 5% to $901,951 according to Domain.

But can this move be repeated or even sustained?

Read on to see what the agents are predicting for the March quarter.

As 2019 rapidly comes to a close, we thought it would be worthwhile to look at what might be in store for the Melbourne property market in 2020.

We do this on the back of the current state of the property market and the economic factors that got us here, namely:

·         Property supply remains low, as vendors are holding off selling hoping for higher prices to come. Although agents report some increase in listings over the traditionally busy Spring period, supply continues to fall well short of demand. As an example, anyone looking to purchase a house in the popular suburb of Carnegie at the beginning of November, would have only found six properties to choose from;

·         Bank lending policy has relaxed in favour of borrowers with the recent loosening of credit lending criteria;

·         The October 0.25% cut to the RBA cash rate to a historic low of 0.75% has further reduced borrowing costs; and

·         Demand is more robust than it was in the first half of 2019, with the popularity of auctions returning and clearance rates above 70% week-to-week.

Source: DANIEL BUTKOVICH ADVICE EDITOR, DOMAIN OCT 16, 2019

Director Robert Allanadale recently spoke with Domain. Read the full article here.

We survey a number of real estate agents across Melbourne for their views of the current residential property market, and what they expect for the rest of the year.

Our June survey accurately picked the bottom of the market where we said:

 ‘we may be at a turning point in the current property market, at least in the short term’.

Our survey suggests that the market will continue to improve, but not all areas will perform equally.

We hope you find this of benefit to you or your clients who are considering buying or selling property in the foreseeable future.

We survey a number of real estate agents across Melbourne for their views of the current residential property market, and what they expect in the next 3-6 months.

Picking the top or a bottom of any market is always difficult, but our survey suggests that we may be at a turning point in the current property market, at least in the short term.

We hope you find this of benefit to you or your clients who are considering buying or selling property.

We survey a number of real estate agents across Melbourne for their views of the current residential property market, and what they expect in the next 6 months. We find this a more accurate guide than relying on the published property statistics which deal in averages when there are in fact many different property markets across Melbourne.

We hope you find this of benefit to you or your clients who are considering selling property.

It’s all doom and gloom in the property press with some experts predicting a 40%-50% fall from their peak in residential property values in Melbourne and Sydney in the next 12 months.

Are we on the cusp of a property crash like the 1990’s ‘recession we had to have’, or is this just a pause after a strong rise and prices will soon stabilise and resume their upward trend?

There is so much to learn when transitioning yourself or a family member into Aged Care. From facilities and vacancies to the complexities of DAPs and RADs. One aspect that is often not taken into consideration is the fact that a high percentage of people have to sell their home to fund the transition.

We’ve all heard the agents’ mantra, “Position, Position, Position”, but what is the point of marketing a well located home when buyers are turned off by its poor presentation?

Sure, some buyers may jump at the challenge of securing the location regardless, but without good presentation, competition for the property will be lessened, buyers that are interested will simply reduce the price they are prepared to pay, and the property will be undersold. All for the sake of what - $10,000 or $20,000 spent on paint, a few repairs, a bit of landscaping and some staged furniture? A properly managed outlay like this can easily see a four of five-fold return.

In a recent chat with Robert Allanadale, Director and Founder of Tower Property Advisory, he told us about a woman he met a number of years ago and her unfortunate experience with a real estate agent.

If you have a property in Melbourne that you are looking to sell, your main objective will be to sell it quickly and to sell it for the highest price possible. However, there are a number of things that you need to take into consideration when selling in order to achieve this.

1. Presentation - major items

When selling your own home, if it is well presented, it will appeal to more buyers. This leads to greater competition for your property and a higher sale price.

It is therefore important to understand who the likely buyers will be on your property, then ‘get the balance right’ with presentation work. There are a couple of things to consider...

Almost 52,000 Australian households are at risk of defaulting on their mortgages in the next 12 months and a quarter of home owners are under home loan stress, a data analyst has said.

According to Digital Finance Analytics (DFA), 767,000 households were in mortgage stress in April, meaning they had little leeway in their finances, up from 669,000 the previous month.

Of those, it said 32,000 were in severe stress and unable to meet repayments with their current income.

It estimated almost 52,000 households were at risk of defaulting in the next year.

Source: Jennifer Duke | Domain.com.au

The real estate industry is quickly turning against “free” agent recommendation websites, describing these services as “misleading”.

Some agents are boycotting the sites and real estate institutes up and down the east coast are busy alerting authorities, claiming sellers don’t understand that their information is being sold to a select few agents. 

In recent years two main players have emerged in this space; LocalAgentFinder and OpenAgent.

Source:  Michael Pascoe | The Sydney Morning Herald

Funny thing about the sellers' market for most residential real estate in the east coast capitals: vendors are signing real estate agency agreements that read as if the agents are doing a massive personal favour listing the property.

Just like commission rates, agency agreements are entirely negotiable. It's a simple matter to put a line through objectionable clauses before signing.

And this when auction clearance rates and a shortage of stock mean most properties in the hotter markets are close to selling themselves.

SOURCE: The Australian

SELLING your house can be daunting. There are dozens of possible agents to choose from. Who do you trust? And should you go to auction? Will you waste your money on expensive marketing campaigns?

Faced with this task, more sellers are hiring vendor advocates, advisers who hold their hand through the entire sale process, from choosing an agent to picking the best photos of the house. Vendor advocates mean real estate agents “are kept accountable by a third party”, says Scott McGeever, managing partner of Brisbane buyers’ agent Property Searchers which is also a vendor advocate.

SELECTING A REAL ESTATE AGENT

Choosing a real estate agent is one of the most important decisions you make when selling your property. After all, buying or selling your home is one of the biggest decisions you're ever likely to make in your life.

Therefore, it's important that you pick a real estate agent that not only has all the necessary credentials but one that also has something in common with you. A trustworthy and reliable real estate agent will take the time to listen to you and find out exactly what it is that you are trying to achieve.