january property report
WELCOME TO THE 20’s
Happy New Year to all of our readers, we hope that you have had a good break and ready to kick into gear for a new year. It is amazing to think that there are generations still living today that were born in the post War pre Depression era. Back then Australia was affected by competition in foreign trade and declining prices in export. There was political unrest and hyperinflation driven by borrowing money. This led to the Great Depression in 1929, what a fascinating comparison to the world we live in now. If you have a family member that lived through this time, perhaps now is an excellent time to have a yarn about those days, and their thoughts on how it compares to today.
Looking at the market forecast property volume is still relatively low, which should assist in a balanced market for the first quarter of this year. In the first week of January auction clearance rates floated around 100% an non-auction sales sitting around 920 homes across Melbourne.
This figure is still relatively low when compared to the 1568 homes sold the week before Christmas. Although there isn’t substantial data to predict current projections for price growth in 2021, data suggests that the median average sale price in the area ranges between $600k-$670k. Due to the lack of properties sold publicly prior to Covid restrictions being lifted, there is limited comparable evidence to support valuations for the first quarter. This suggests any new price points will be governed by supply and demand in order to drive the market forward.
So what properties performed well last year? Looking back in retrospect on the year that was Covid, the property market saw a significant spike in interest in the first home buyer sector and acreage market.
The 2 contributing factors were government incentives for buyers and Covid restrictions creating a solid 10% growth spurt for properties. With low supply of properties available, the market experienced fierce competition across the board, with some properties achieving well beyond their price range. This level of competition and growth encouraged Vendors to pay particular attention to detail to how their property was presented and marketed, which paid dividends when yielding exponential results.
What can be expected for 2021? Well there are some key dates to keep an eye out for:
- 28th March 2021 – Tenancy notices to vacate moratorium ends. JobKeeper scheme extension 2 ends.
- 31st March 2021 – Extension to HomeBuilder grant of $15,000 ends.
- 30th June 2021 – First Home Owners Grant ends. Regional grant of $20,000 for new homes in regional and $10,000 for new homes in metro. Stamp duty exemption up to $600,000 and concession up to $750,000.
- 1st July 2021 - Stamp duty waiver ends. Dutiable value up to $1mil, reductions of 50% for new residential, and 25% for existing residential and vacant land purchases.
These dates mark the end of the first and second quarter or 2021 which will have some level of bearing on the economy and how it responds to this change. With less incentives for first home buyers and investors, it may result in stagnant growth in this sector depending on market volume and demand. Secondly, without government support to boost business growth and the regional property market, there will be a heavy reliance upon local economies and tourism to continue to sail these areas through the remainder of the year. If Covid restrictions don’t return and freedom to travel remains there will be an equilibrium that will drive healthy growth for small businesses and townships across the Shire. Now is the time to learn from the past and move forward. Whether we draw on sage advice from the last century or take stock of what is important for personal growth and stability in our businesses and community, a new year should bring a positive outlook and lasting resolutions that have a profound affect. May 2021 be a good year for you, your family, and your business.
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