MARCH PROPERTY REPORT
After a quiet January where everyone was enjoying some much-needed R&R, we are thrilled to have hit the ground running this balmy February. With property owners working harder than ever to get their homes up to scratch, we are excited about the array of beautiful properties coming to market. It’s obvious that Vendors are still hoping to ride the wave of 2021’s expediential growth in the housing market as we have seen a large increase in the number of properties hitting the market this month.
This alleviates the pace of the market slightly as buyers have more options. As advocates for our clients, we always preach property presentation. However, it is evident that our vendors are putting in more effort than ever before. Virtual staging is popular now being such a cost effective and useful way to stage a property online. To maximise your sale result presentation matters. Record low mortgage rates falling below 2% fuelled the 2021 market frenzy resulting in the fasted annual growth in 22 years. That’s more than a whopping 20% growth over the past 12 months. Experts predict the increase is likely to have peaked with a more modest growth forecast for 2022. The rapid pace of the housing market is likely slowing due to looming mortgage rates rises, stricter lending rules and more properties coming on the market. Regardless, the big banks are still predicting an annual house price growth of a more modest 6-8% in 2022.
Many homeowners are looking for an update on what their home could be worth yet valuing a property has never been so difficult. Agents must take into consideration the frenzy whilst balancing their valuation with comparable data, not to mention homeowners’ expectation and market fluctuation. Most homeowners have a “wish price” in their mind when it comes to selling and 9 times out of 10 our clients suggest a figure of what they would like to achieve for the sale of their beloved property. However, it is important to understand the risk of a high price guide. Reduced enquiry rate with minimal competition resulting in price reductions are common when listing a property above market expectation. Melbourne buyers are used to seeing underquoting laws flaunted and therefore often automatically assume they need to add 5-10% to the advertised price meaning if they see a property advertised slight above their budget they may not enquire. Correct pricing is key, and with no comparable data, it can be hard to simply rely on that one emotive driven buyer to purchase the property. The old saying of ‘it’s worth what someone is willing to pay for it’ is true, but the caveat is that it needs to be priced right and presented right. The market will determine a property’s value, and with competition easing, we advise to have a more strategic approach to selling your property this year.
It is no surprise that in the year of 2021, interstate migration to the sunny state of Queensland was more than double the decade average as southerners fled lockdowns to enjoy a better quality of life. We’ve also experienced this firsthand with many of our clients making the move to regional Victoria. The work from home movement is still strong, so we need to facilitate it as much as possible.
It is worth recognising where we have come from in such a short amount of time. The growth has been phenomenal and it’s interesting to see locals making the big move interstate and Melbournians making the tree change to our wonderful part of the world. If the year does see a more balanced market, hopefully that means an easier year for you and your family. Returning to normal is what we’ve all wanted since Covid-19, and maybe, this is the start of that return to normality.