Market forces spring into action

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With an REIV 62% clearance rate, up from 54% on this time last year, we can see the market is changing. It is waking from an eighteen month slumber. The market will not revitalise itself overnight, but over the next six months I think we will see solid growth in the suburbs of Melbourne with good amenity.

The Valuer general put the Melbourne median movement in 2011 at approximately 1% down. In 2010, the median for the whole of Melbourne moved upward a whopping 17%, even though the downturn began near the end of April. This year’s results from the Valuer General will not be available until about June next year, but anecdotally, I believe the overall market will have been very stable and close to no movement. Some of the better suburbs will have moved a little forward and many of the new estate suburbs will have contracted in value.

Whilst we see many companies talking about monthly median movements, the small samples of sales these companies are basing these results on make the results nearly useless. Considering the different data analysts all have different methods of collecting, collating and then analysis, and they all have different results, it is pretty easy to get confused with where the market is going.

With owner occupiers making up a large percentage of the market during the current season, and if we get another interest rate cut on Cup Day, I think we will see turnover dramatically increase in the autumn season next year. With increased turnover and good amounts of owner occupiers, I think the market is poised to return to positive growth over the next few years.

If you are considering a property purchase, whether you are an owner occupier or an investor, please give our office a call. We can assist you in finding, assessing and or negotiating a property for you. There is no obligation for our first meeting.

Ian James
JPP Buyer Advocates

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About the author

Ian has been operating his own businesses for more than 25 years. During this time the self taught lessons of building the business, dealing with staff, suppliers, clients and economic woes have been invaluable. Ian is a fully licensed Real estate Agent, a member of the REIV and registered with the Business Licensing Authority.

Buying property is not just sticking up your hand and outbidding your rival. It is an emotional, fiscal and psychological decision that needs to be planned and well executed. Ian is usually involved in over three hundred property negotiations per year; ranging from the $250,000 first unit purchase for a young couple to multiple million dollar residential developments. Ian's business background and endless numbers of negotiations make him one of the industry's leading negotiators.

Ian is married with two adult children, living in Patterson Lakes. He is a keen fisherman when weather and business allows the time.