Variant Behaviours, The Seasons and Future Prosperity
Welcome to this week’s ponderings….
This past week or so has seen many things and people’s variant behaviours popping up and not necessarily conducive to either their well-being or future prosperity.
“So, what in heaven’s name is he talking about now?” You might very well ask.
The information as to market conditions have been rife and coming from a bucket load of apparently well versed and well recognised sources and resources and the general message people seem to be “buying” into is that the market is in disarray and collapsing!
Much if not most of the attention has been driven by what is happening in Sydney and Melbourne but particularly Sydney – it has dropped considerably recently according to the pundits.
The following graph suggests what has happened in Sydney market over the past 20 years and as you will see, since 2012 to mid 2017 there has been a 57% increase overall and that is massive.
As everyone predicted and as was evident last year it started its decline and now has “crashed” according to many reports and frankly lazy reporters riding on the back of reports coming from Sydney and extrapolating that into the broader market as being indicative nationally.
But that is Sydney and as I have mentioned before, other markets around the country are doing very well indeed and some areas are booming. Even in the not so booming areas there are markets within the market that are doing very well indeed. Perth is in recovery after long period of downturn, Tasmania booming and other country regions going great guns.
Take a look at our Sunshine Coast – Here there are some areas not faring so well, but overall, most are doing just fine thank you very much. Who could have predicted the incredible growth in Golden Beach, Moffat Beach and other areas most immediate around our office and the growth corridors further out.
For us that is due to our incredibly beautiful world and the current and future infrastructure that is in place and frankly, has very little to do with what’s happened in the southern states in the past.
The problem, if there is one, is that the stats being reported, are coming out of the major cities and not truly reflective of things around the country and if there is a whiff of a “crash” anywhere, people run scared and begin to panic.
Are we seeing hesitation from buyers? Yes, but if handled correctly they too see the error of their thoughts. Are they buying because Sydney is going through not so happy times, or are they buying because it suits their lifestyle and family requirements?
Some will even use what is happening to make silly offers trying to feed the fear.
Will things change here? I am sure they will because like Sydney, nothing can continue to grow forever. Even trees and plants have their winters and then along comes summer and you can’t keep up with the pruning, mowing and keeping things in order.
The trick if any, is to work with and try to predict the winter, summer, autumn and spring cycles available to us and that has been an age-old issue with any market.
When will they change here? They already are because of the rumour mongering not because we have an over inflated market place. Are we going to see the same price increases as we have seen over the past couple of years? Probably not because generally prices are softening but there are still prices being achieved that are surprising for our region and that is not because of Sydney etc but in spite of Sydney etc.
What is happening in the future?
Our region is solid and moving forward and in the immediate term is having a little rest by the feel of things. Many believe we will have the inevitable “correction” and dependant on what happens with our national and global economies that might occur for us mid to late next year.
More immediately, the current level of housing debt and inability to pay will cause concern I’m sure just as the high levels of rejections for ref-inance applications are likely to cause further stress for many as the following graph suggests.
So, in the meantime, don’t hang your hat on the past and don’t ignore the present – watch your prices and time on market because stock is starting to build again and that will impact things before anything else but what is even more important, watch the agent/agency you engage.
As always, make sure they are out for your best interests as a seller and can work with not only the conditions but marketing to and negotiating with buyers to get you the best price not just any price in order to fill the order because they too are softening to the pressure.
In wrapping this one up, take a look at Sydney market over the period 2012 – 2017; It doesn’t matter at what time a person may have entered the market, they would have done ok – the earlier the better of course and only those entering the latest phases will be negatively impacted if they can’t get out without re-entering with some spare cash. (Maybe more will move here and feed our prices)
Short of a tsunami and global depression, the long-term prospects for real estate are still good and what a spectacular place the Sunshine Coast is– that alone is food for future prosperity.
Until next time, Happy Listing, Selling and getting your Seasons right…