The most recent consumer sentiment data from the Westpac–Melbourne Institute provides an interesting insight into what we are seeing in the Victorian property market right now.
The Consumer Sentiment Index for June came in at 102.2 which, for those that are unfamiliar with these figures, suggests that there are marginally more optimists out there than pessimists. (An evenly balanced market would give us an index of 100 exactly). More importantly, this monthly survey found that 15.8% of Australians nominated real estate as ‘the wisest place for savings’. This figure was up a little on the 14.7% from March, but still well down on the average of 25.4% in 2015, and the 29.5% of people that are now favouring bank deposits!
So what does this mean for our property market? Well, what we are experiencing is a market where exceptional results are certainly being achieved, but where an increasing number of buyers are also quite prepared to wait if a property does not “tick all the boxes”.
From a vendor’s point of view, this is a market where if you do all of the right things, you will attract a number of competing buyers. This means presenting the property in the right way, setting realistic price expectations, appointing the right real estate agent and marketing the property well. However, there are results in the market place that clearly suggest that buyers won’t just rush into buying anything at any price.
In the last month we have achieved some fantastic prices for some of our vendors. None more pleasing than an auction of a single-fronted home we handled in Port Melbourne where our vendor presented the property beautifully and applied all of the right advice. The result was a heavily contested auction where the bidding soared more than 15% above agent and vendor expectations, selling not far short of $1.4 million.
What is clear at the moment is that the most active segment of the market are those buyers who already own a property, and are looking to upgrade or downsize. Perhaps it is the knowledge that they own an asset that has increased substantially in value in recent years, that gives them the confidence to compete hard to secure what limited stock is currently available… however it is these same buyers who are also quite prepared to wait if a property does not meet all their requirements, be that quality, location or value.
With the low stock levels playing a big part and the uncertainty around the Federal election now set to be cleared up in the next few weeks, we expect to see continued positive results as we move into the second half of Winter, and in the lead-up to early Spring. So if we can be of assistance in helping you prepare your property in order to make the most of the favorable market conditions, don’t hesitate to give one of my team a call.