MARKET NEWS
Sales Market Review
Tuesday, February 23, 2010
The property market throughout February continued to build momentum as more property became available after the holiday break and we continued to record strong buyer demand. What we are experiencing at the coal face of the property market is supported by figures suggesting consumer confidence is elevated and the labour market has experienced the fastest growth in five years. While the Reserve Bank caught all the market forecasters off guard when they decided to leave interest rates on hold during February, it appears improved economic conditions and supporting figures will add pressure to the RBA to recommence its monetary tightening policy in March.
We have continued to record extreme attendances at open homes with buyer numbers sitting in excess of 50 at the first open home inspection for most properties. The increased buyer turnout is a result of not only improving market confidence but it appears also as a result of less property becoming available. As we move into a traditionally busy period of selling it is interesting to review the present conditions against the same early period in 2009. What was revealed is that 380 transactions have been recorded thus far in 2010 versus 500 transactions in the same period last year. However supporting our view that sentiment has improved markedly is the fact that there have been 91 auctions with a clearance rate of 74% in 2010 compared to 26 auctions and a clearance rate of just 31% for the same period in 2009.
While sale prices are relatively buoyant we are still seeing some level of hangover from the global financial crisis (GFC) with buyers still slightly cautious when calculating a home’s true market value. The message here is that sellers should not become overly optimistic because buyers are undertaking more research than ever before when looking to purchase a new property. In Balmain and Rozelle there is definitely less volume of property becoming available than we would expect to see in such favourable selling conditions. A contributing factor to this has been highlighted in our discussions with a number of potential sellers. They have suggested that they are keen to upgrade yet limited opportunities for family homes are stalling their decision to move. We are seeing the top end of the market free up and transact more easily however demand is simply outweighing supply at the moment, so we expect the current market trend to continue for some time.
Following two months of transactions, we have seen the strongest demand continue to hover around the $1m price point. It is properties appealing to families which are attracting the best interest in the $1m to $2m price point. At the top end we have seen limited transactions however enquiry has improved and there is enough steam spilling over from 2009 to suggest this sector of the market is in a good position. Interestingly, these market conditions are mirrored in the rental market with prices being pushed due to the strong demand for a reasonable quality home and very few sales are being recorded for investment purposes. So, for many people looking to acquire a new property patience may be required but at the same time you need to move quickly when you identify a suitable property.
- Sales Market Review
- Sales Market Review
- Sales Market Review
- Sales Market Review
- Sales Market Review
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