MONTHLY MARKET WRAP: FEBRUARY 2019

  • March 4, 2019

Our first market report for the year and we’ve again seen changes in buyer sentiment, property pricing, vendor movement and banking. Initially surmising the status of the 2019 market, we’re seeing wider acceptance of the new economy, bank lending practices, property values and how to navigate through the market conditions. As a result, we’ve witnessed buyers being more willing to make offers, albeit those being put forward may not meet sellers’ expectations. We’ve also seen an explosion of buyer activity with a 30% jump on the number of buyers attending our open homes compared to the final quarter of 2018. This increase suggests that many buyers are observing the conditions, are potentially looking for good value in order to purchase or are simply interested in being aware of what’s happening.

 

In financial news, interest rates have been left on hold and market commentary now suggests that there is an even chance of a rate cut being the next move from the RBA. Whether this occurs won’t have a significant impact on the decisions of buyers and sellers but moreso on the ongoing dialogue from banks and the RBA which suggest rates are unlikely to increase this year. We’ve also seen the conclusion of the Hayne Royal Commission into misconduct in the banking and financial sector which was welcomed by the property market. We’ve already seen the forerunners of change from the Royal Commission which has greatly increased scrutiny in lending. It has meant many mortgage applications have been knocked back or buyers’ borrowing capacity significantly reduced. This transition in lending practices was a critical driver behind the downward pressure on prices that occurred in 2018. Speaking with buyers in 2019, it would appear the challenging lending environment will continue and further restrictions may be imposed following a raft of recommendations from the Royal Commission that are still to be reviewed and considered.

 

We’ve experienced a steady flow of new listings coming onto the market this year but there certainly isn’t an oversupply. Many were anticipating that February and March would be larger months for the selling market as April is an interrupted month with schools holidays, Easter and ANZAC day. However, as it has turned out there are far more buyers looking than there are properties available. What those prospective buyers are doing is another thing, with 78% of Sydney property being on the market for more than one month. We are experiencing solid buyer demand for A-grade properties while anything outside of that category is either dismissed or needs to be positioned at an attractive price point. All in all, buyers still hold the upper hand so far in 2019, however, sellers have a stronger opportunity to sell as long as they are open to meeting the market.

 

February’s signature performers

 

 

 

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