Hallelujah!! The whole market has turned around now we have a clearance rate of 64%, which as one paper described it as 65%. What’s a single percentage point between friends? But it is great to see that the whole property market is now safe and that the world economy is recovering! I am sure we will find the answer to how the Universe started before next weeks figures are released!!!!!
Doesn’t anyone have anything useful to write? A few weeks ago a 67% clearance rate sounded the “death knell” for the property market as we know it. Yet a 64% clearance now signals the revival??
Last week it was announced that in the first quarter of this year Brisbane and Perth median house prices had surpassed Melbourne and our market was in for a downturn. Let’s look at a little more data. In April, there was a 29% increase in new home loans in Melbourne. There was a decline of 4% and 5% in both Perth and Brisbane. Melbourne is still welcoming more and more people to our city and even the State Government is looking at ways to assist people to buy smaller properties.
Regardless of “one off” statistical data, Melbourne property prices have to increase over the long term as a simple function of “supply vs demand”. Whether the market will be flat for a week, a month or a quarter is unknown, but if we look at short term time frames in the property market, then we need to look over five years. The state government are mooting a new scheme to try to persuade people to buy smaller houses in the metro area. Changing the density of certain areas of the city will assist people in the short term but in the long term property prices will continue to rise, just like most other capital cities around the world.
We see today the release of new figures that our farmers are starting to come back to some financial reward. This will in turn mean that rural areas will again have a strengthening income. This in turn will make buying and renting in rural areas harder, forcing more people back to the city. Our State government is trying to assist people into these rural areas with changes to the building grants for first home buyers.
What is encouraging to potential purchasers in the market place, is the current figures for numbers of private sales. Whenever a property is up for private sale, is purchased before auction, after auction or is passed in and then negotiated, the whole deal must be looked at. Whether there be negotiations for special conditions, special terms, vacant possession or receipts of rents and profits, a good negotiator will do so much better than simply going to auction and sticking his hand in the air.
If you require any help negotiating a property transaction please feel free to contact us on 9523 1054 or read through our website at the “how to” series.