Our condolences go out to all those who have lost family, friends and homes in the most devastating fires ever seen in this country. Personally I would like to thank the tireless volunteers who have saved countless more lives. These selfless volunteers, some of whom have lost their own homes, continued to work for the benefit of all Victorians. I hope all those who are in a position to help, whether it be volunteering time, giving clothing, blood or donating money,can dig deep to assist in this unprecedented tragedy. There will be few people across the state who do not know of friends or relatives who have been touched by this tragedy.
Regardless of the heat on Saturday and the fact we are only just into February, 99 Auctions were reported with 64 sold and 35 passed in, 23 of these on Vendors bid. Whilst this sample is not large enough to give us any indication of what will happen this quarter, next week there are 300 auctions scheduled. These figures were reported by the Real Estate Institute of Victoria.
For those who have not been reading our regular market comments, I will repeat our thoughts on where the market is heading. By the way this is now almost universally agreed by everyone putting a comment in print. The upper end of the market, above approximately $1.5M will be hit hard this year. This market will show signs of dropping in the vicinity of 25%-40% this year. This will be made up mostly of people who have a financial “need” to sell.
The middle range of $700k – $1.5M will be quite volatile. Whilst some well presented homes on good land will sell very well, the poorly located, poorly presented properties will struggle. Overall the statistic will probably show this range as steady with maybe a minor drop.
It is the sub $600k range that will perform very well this year. There is a huge rise in demand for these properties from both first home buyers and astute investors. Whilst the government grants remain in place first home buyers can pay off a loan at nearly the same as what they will pay in rent. So anyone with even close to enough deposit will be entering the market over the next six months if they can. The small investor will also be targeting this market. Good locations around Melbourne that consistently show double digit annual growth over long periods will be almost revenue neutral from time of purchase. Revenue neutral property investment usually takes about three to five years. Those who buy this year will be a long way ahead.
This market range will probably show increases in price due to substantial demand in the vicinity of 3% – 10% this year. Call us now for a no obligation meeting to discuss your needs. Anyone can buy property; an expert will assist you to buy the right property at the right price.
Ian James
