The last six months has seen a lot of people’s confidence in the property market waning, even though nothing in the market has significantly changed.
It has been clear people are still worried about the economy despite interest rates staying stable this year.
Early on in the year, in January and February, a number of properties were selling well above market valuation. In March we saw a huge shift where buyers lost confidence, left the market and are now sitting on the fence and waiting to see what happens. However, in saying that, properties are still selling in most.
What this year has shown are the properties that are good and those which aren’t. The properties that don’t tick all the boxes are struggling to sell, which is why investors always need to be buying better quality property. This year has proven it is worth paying for a better property in a top suburb than it is to get a lower price for a property no-one else really wants. The high demand suburbs never change and typically perform from decade to decade.
There has been a lot of talk about low auction clearance rates. But auction clearance rates are not the best way to describe a market. Good properties will often sell before auction and those that don’t sell on the day of auction, often sell in the next few days. So the number of days property has been on the market is regarded by those in the industry as a better measure.
The only reason regional properties seem to have been in slightly more trouble than the city properties is because there is more supply than demand. However, a good property still sells, and will continue to sell for the rest of the year.
In the next six months, the volatility of the market will lead to great opportunities. The current state of the market is temporary glitch and is expected to be back on track soon, but in the meantime it offers a great chance to find great homes at great prices, in both the luxury and normal property market.