The property market may not be as bad as the findings of a recent Real Estate Business straw poll might suggest, based on comments from a number of agents in Sydney and Melbourne.
The online-based straw poll, conducted last week, revealed that 58.9 per cent of the 300-plus respondents felt that the Reserve Bank of Australia’s (RBA's) decision to cut the official cash rate by 0.25 points to 3.25 per cent wouldn’t stimulate the property market.
Despite the findings, a number of real estate agents contacted by Real Estate Business have reported increased sales and are optimistic that the rate cuts will drive buyer confidence and property sales.
The principal at Ray White Croydon, in Sydney’s inner west, John Shalala, said he had witnessed a 50 per cent increase of sales in the past week alone.
“This week, there has definitely been a turnaround,” Mr Shalala said.
“We made a number of sales in the last few days and we’ve noticed that there’s definitely been an increase in business.”
“There have been properties that we’ve had sitting on the market for quite some time, but [they] just sold suddenly,” Mr Shalala added. “And it’s two or three at the same time so that’s definitely a good sign.”
The Sydney and Melbourne auction markets have also strengthened of late, consistently recording clearance rates above 60 per cent in recent weeks.
While Mr Shalala believed the turnaround was partly due to the start of the traditionally strong spring selling season, he said the recent rate cut was likely to be a more significant contributing factor.
In Melbourne, hockingstuart Hawthorn principal Maurice Di Marzio said he had also seen a boost in buyer confidence on the back of and increased activity.
“Over the past five to six weeks leading up to the speculated [rate] drop, there’s been a significant increase in activity from buyers, and there seems to be a fair bit more confidence in the market from eight to ten weeks ago,” said Mr Di Marzio.
“There has been a shortage of supply on the market over those months and that has held the market up quite well.”
He added that the local auction clearance rate has also increased over the past eight to 10 weeks, rising into the high 70 per cent region.
When asked about the results from the poll, Mr Di Marzio states that some people are still prejudiced by the negative press about the market and the economy, but is hopeful that this will change.
“People are probably a bit used to hearing about [the negative press] the past 12 to 18 months,” he said. “It will take them a while to get their head around the drops and the activity going on in the market place.”
Only recently, Professionals Real Estate Group chief executive officer, Glyn Morgan, said he's seeing evidence of an improving property market on the east coast.
“It does not matter if you are looking at information from auction clearances, sales through RP Data, the Australian Property Institute or from valuers such as Herron Todd White, the research is all saying the same thing ... the market is on the improve," he said in early October.
“Auction clearance rates have improved, RP Data has reported price growth in Sydney and Melbourne, API is reporting that Brisbane and Sydney prices are rebounding and Herron Todd White says property prices on the east coast market are set to rise.
“This is exactly what our members, who work at the coal face, are mostly all saying."