Congratulations to the Geelong Football club and commiserations to both the St Kilda team and their fans. It was a fantastic game and I think both teams deserved to win. But only one can. The same goes for buying real estate. Each property can only be bought by one person; the rest can come back next week.
If you want to learn more about how to negotiate, see us at the Home Buyers Show at the Melbourne Convention and Exhibition Centre on Friday Saturday and Sunday this week. I am speaking each afternoon around 3.30 on the Home Buyers Stage.
Over the weekend there were 135 reported auctions. This was 5 times as many as last year with a better clearance rate. There were a total of 728 properties reportedly sold last week. This is the first drop under 1000 since the last long weekend in June.
We can expect to see at least the demand level remain high throughout the next two months. Do not expect the lowering of the first home owners grant to make any significant change to demand, except, maybe a slight drop in the outer “new purchasers’ estate market”. The key to the next two months in the Melbourne Real Estate Market will be supply.
Many of the agents I have spoken with have indicated, a healthy, albeit, not huge increase is expected. The vendors’ enquiries have increased but not in the normal huge numbers that are usually seen around this time of year.
We also saw the release of Australian Bureau of Statistics (ABS) population numbers for the quarter ending in March. Again Victoria had the largest population increase. Whilst Western Australia increased 3.1%, and this was the largest percentage increase, this equates to only about 69,000 people. Victoria, at 2.1% equates to an increase in excess of 110,000. And the unemployment figures reported in the Age this morning also give us an indication that we are unlikely even to reach 1,000,000 unemployed.
So where is the property market going?
• We have tremendous demand and limited supply.
• People in Victoria are feeling very secure in their employment.
• Interest rates are low and are going to remain there for a very long time. We may see a small increase next year if “big business” really takes off.
• People are flooding into Victoria at a greatly accelerated rate.
• Whilst the European and U.S. housing markets are floundering, those of the Asian communities are not. And this is where there is plenty of excess cash at the moment.
It is not hard to see why Melbourne property prices are going to keep increasing for a very long time.
We hope to see you at the Home Buyers Show over the weekend
Ian James
