There’s been quite a bit of media coverage in recent months on the shortage of available stock in the Victorian property market. What many people still don’t realise, however, is just how serious the current shortage is, or how much it is impacting on the prices that some vendors are currently achieving.
Recent market data from Domain showed that the number of properties listed in Melbourne in September was down by 19% on the same month in 2018…and 2018 was already well done on the years prior. In fact, the turnover for the Melbourne market is now at a 20-year low, and there is no short-term solution as far as I can see.
This shortage of property for sale has clearly impacted on prices, with the market in the past 4 to 8 weeks picking up by as much as 10% in some areas. These increases are in response to strong competition between buyers, with some auctions drawing competition from as many as a dozen separate bidders. Some top-quality properties have been selling for close to the prices we experienced in the peak of the market in 2017! At this stage I expect these conditions to continue to the end of this year as a minimum.
The big question in many people’s minds is what will happen in 2020? Will we see an increase in stock levels as more people recognise the opportunities that the current market conditions are providing? Or will the stock shortage continue, providing impetus to further price increases in the new year? Only time will tell.
Of course, with three separate cuts to official interest rates by the Reserve Bank so far this year, and many economists forecasting one or two more cuts in the next six to nine months, home buyers will have access to some of the most affordable housing finance in living history, which is good news for anyone planning on making a move.
What is abundantly clear is that anyone considering a sale in the next six months, particularly those with a preference for ‘the bird in the hand’ where major financial decisions are concerned, should give careful thought to making that move earlier rather than later. In fact, there is still time for you to achieve a sale this year if you act quickly.
As is always the case where major decisions on property are concerned, our strongest recommendation is to seek experienced and objective advice before you commit to a course of action. So, if you would like to discuss your options without any pressure to sell, don’t hesitate to give one of our team a call.