01 Jun The state of the property market – 2020.
CoreLogic has released its March Quarter Property Market & Economic Review outlining their take on the state of the property market. We are big fans of the work that CoreLogic do: good, solid, supported facts around property and the economy, with very little hype and emotion – our type of people.
Straight up, if you follow us on social media (LinkedIn, Twitter, Facebook, Insta) or know us in real life, you’ll know we aren’t all that big on fearmongering. We don’t do doom and gloom, or buy into the mass media hysteria that tells us the economy is about to fall, property will stall for years and the world, as we know it, will cease to exist.
Tooooooo much drama.
Instead we like to focus on the good things happening in the market and the world. Like this man who used his Iso life to build a gigantic, laughing kookaburra and drove it around the streets bringing joy to so many people.
Brilliant.
But I digress……
When the report came out this week it was refreshing to see that really, there weren’t any surprises. Followers of non-hysterical media will observe that the insights the report provided were what they had been reading, hearing and talking about for all of Q1 2020.
The world has been in a pandemic. Correct. There will be an impact to the economy. Correct. People will find a way to manage together. Correct. The Government will introduce a range of stimuli to stimulate. Correct. Australians will innovate/pivot/collaborate and find a way to make life and business work. Correct. People will remove their properties from market. Correct. People will list their properties for sale. Correct. People will hibernate their property development projects. Correct. People will ramp up their property development projects. Correct.
On the whole, everything that a reasonable person should have been expected to occur has occurred.
We aren’t going to stand here and say it’s been a breeze. It hasn’t. Or that we don’t know people who have come close to losing it all. We do.
But as a whole, Australia has managed the whole thing well to date and has a considered exit strategy from the pandemic in place to bring life back to as close to a pre-‘rona state as possible.
The CoreLogic report supports that.
Looking forward. Looking back.
There are suggestions that the market is tipped to have a solid Spring. Stifled demand from the Corona Iso period, combined with low rates, reasonable access to funds and stock available should lead to a steady upwards trajectory coming into the end of the year.
The report shows that, to date, housing values have shown only a mild slowdown – less than half a percent over a month. Sales values, understandably, declined around 40%. And stock available for sale declined by around 25% based on this time last year.
Ahead of the game.
Rents are likely to be where the most disruption and declines occur. This week saw the first decision to award discounted rent to a tenant be handed down by a tribunal (QCAT) here on the Sunny Coast. We anticipate there will be more and more cases like this where a discount will be applied in favour of a deferral of rental payments.
From a landlords perspective, it makes sense to work with your tenants to come to a mutually beneficial arrangement now, before it gets to tribunal stage and the decision is made for you.
Really, we just love our homes.
Any homeowner knows the (occasional) blood, sweat and tears that goes into saving your house deposit, the painstaking research into finding the *perfect* location and the sacrifices that are made in order to pay off a mortgage.
First National Real Estate CEO Ray Ellis made a good point that “Australians don’t simply view their property as an ‘asset’ they view it as a home. That has been demonstrated strongly during these challenging times. What people have been missing most is having friends and family over to their home. Or visiting the homes of friends and family. We have seen an increase in people committing to improving their homes through refurbishment and the like. They have spent time considering what sort of home they want to live in now and in the future and researching that. The message is it’s a home, not simply something they own. I have seen no evidence of that attitude disappearing. It’s actually increasing.”
And Stuart Wemyss who writes for Michael Yardney’s Property Update writes “the fact is that people will fight hard to avoid having to sell their home. It is their ‘castle’ and it’s that last thing they want to do.”
People will fight for their homes and their livelihoods; they will work together to make it work.
Regardless of what you read on the news.
If you need help evening out your cash-flow, or getting your property development back on track, give us a shout. We work with property and business industry leaders and funders who can provide you with the guidance and finance to help keep you moving.
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