Autumn Newsletter 2021
Hi Everyone. I’m proud of the fact that Your Australian Property is totally independent and not geographically confined to one specific area of Melbourne. My observations and insights are what Your Australian Property Buyer Agents see every day across a broad area, attendance at auctions, discussions with numerous estate agents, valuers and buyers and sellers active in the marketplace. In that regard, my purpose is to provide a unique insight into the intrigues of the Melbourne property market, rather than a statistical based data approach.
Whilst median house prices and clearance rates make for good reading, I am interested in drilling down to the clearance rate for a particular suburb or type of property. The clearance rate for the whole of Melbourne is interesting to know but if I’m buying in a particular suburb I want to know about the demand in that specific suburb before I buy. It’s the same with median house prices. You don’t buy a suburb median price – you buy a property, in a street, in a suburb. Median house prices are too often skewed if too many of a certain price level are sold i.e. lower priced investment stock or a larger number of higher value homes are sold. Drilling down to the specific street where you’ve found your ideal property can therefore make a difference.
In my report when researching the market for my clients, I analyse sales of comparable prices within a 500 metre radius of the subject property. Do the comparables share the same walk distance to schools, public transport and importantly, the lifestyle village? Are the comparables in a similar streetscape? We can’t compare main roads with quiet side streets. There are so many variables that affect value.
My and being a fully Licenced Real Estate Agent (since 2001) has not been reproduced by data. There are so many considerations our Buyer Agents take into account when advising clients on purchasing a property or buying at auction. Emotions can easily take over from the science and that is why many people overpay or are outwitted by sales agents or competitors. That is why having someone represent your best interests when looking for a property or buying at auction can be a wise decision and save you hundreds of thousands of dollars, especially in the current market.
The Victorian house market continues to boom with Melbourne, Geelong, Ballarat and Bendigo undersupplied and buyers paying over the quoted ranges. The first quarter of 2021 has been one of the strongest markets that I’ve ever experienced. For the first time Melbourne’s median house price has risen above the $1m mark, while median house prices in Middle Melbourne reached a record $1,148,500. Unit growth is slower with the median price at $672,500 an annual increase of 3.4%. Victorian regional homes have reached a record median value of $510,500.
My analysis of REIV data and my own research reveal that:
· Owner Occupiers are out in record numbers
· Growth is being driven by downsizers, lifestyle buyers and upsizers
· First home owners have been buying due to government grants
· Investors aren’t purchasing in record numbers
· Units are not growing at the same rate (due to lack of overseas students and travellers)
· House prices in Melbourne and Sydney will continue to rise due to low interest rates (not expected to rise for 3-4 years), pent up demand after lockdowns (particularly Melbourne), expats returning to Australia (at the rate of 4,000 per week)
I hope you enjoyed this Autumn 2021 edition of Your Australian Property Newsletter and as always, I thank you for the ongoing support of our services.
Director – Your Australian Property