Buyer’s agents from around Australia give their insights into how they think the market will shift this spring, highlighting one capital city’s property market at its strongest in 12 years.
According to Real Estate Buyers Agents Association of Australia (REBAA) president Rich Harvey, buyers need to take more time researching the market and less on worrying about the property cycle.
“Our philosophy remains the same: there are opportunities in whatever market you decide to buy in,” Mr Harvey said.
“At any time of the property cycle we’re in, there will always be some areas, some suburbs and even some streets that have not experienced the same growth as others, along with property types that are at different stages of the property clock.
“If you have the money, buy now; and if you are prepared to do your due diligence, you can buy well in any market.”
Sebastian James, REBAA NSW representative from Hunter James, said that the market in Sydney is slowly turning around to be balanced, with stocks higher than this time last year and will keep on increasing.
He also highlighted the importance for buyers to negotiate, particularly those looking at properties in the middle and outer rings of Sydney.
“As we continue to come down from the peak of the boom, we anticipate [that] well-located quality inner suburban property will continue to achieve strong results in the spring market; however, with clearance rates falling below 70 per cent, coupled with increasing uncertainty, buyers would be wise to take a more cautious and patient approach,” Mr James said.
Melbourne is expected to see demand outnumber supply, which will raise property prices, said Leigh McConnon, REBAA VIC representative from Buyer's Advocate.
“This is likely to be magnified by the first home buyer market, which has been supported by state-based incentives to remove stamp duty for properties under $600,000 with a sliding scale up to $750,000,” Mr McConnon said.
“This price point is likely to be particularly strong.”
Despite the price growth, Mr McConnon said that purchasing property for under $600,000 with land, close to public transport shops and located within 15 kilometres of the CBD is still a reality.
He said: “This is likely to be a two-bedroom villa in the northern or western suburbs. However, this represents great value, particularly when apartments are often selling for more with little or no outdoor space.”
Brisbane’s apartment market is expected to soften further due to unit oversupply getting worse, with new developments approaching their settlement dates later in the year, according to Zoran Solano, REBAA QLD representative from Hot Property Buyers Agency.
The current focus in Brisbane is established property in the inner and middle rings of the CBD, but the capital city faces increased demand yet with limited supply.
“We are also seeing a clear downsizer’s movement here in Brisbane as the older generation move out of the large family home into smaller lower maintenance properties,” Mr Solano said.
Australian Capital Territory
Canberra is set to be a very popular market, and will be hard to find a purchase, said Claire Corby, REBAA ACT representative from Capital Buyers Agency, who hopes competition will ease and prices will stabilise.
“Spring is a busy time in Canberra as many employees and students begin their search in anticipation of being settled for the new school year or employment commencement in 2018,” Ms Corby said.
“It’s a time of transition, with workers and their families being posted in or out of the revolving door that is Canberra.
“We’re seeing a growing number of investors turning to Canberra for its balance of long-term capital growth and higher yields over Sydney and Melbourne, and they’re closely following local infrastructure projects.”
Property buying prospects have a difficult spring ahead of them, according to Paul Siwek, REBAA SA representative from Logica Property, who said that the fragmented market skews fair market value, which can leave buyers overpaying without realising it.
“Over the past two to three years, some suburbs and types of property have shown capital growth up to three times higher than in other areas,” Mr Siwek said.
Complicating matters further, especially in the inner ring, is the rise of selling by auction.
“As market values are harder to judge, lack of advertised prices makes the buying process more stressful, and buyers are more prone to overpaying than ever before,” he said.
Property in Perth is strong overall, both from local and interstate buyer demand, according to Ben Lamers, REBAA WA representative from LMW Property Advisors.
“For the first time in years, we are seeing interstate buyer demand as international and interstate investors look away from overcooked markets like Sydney and Melbourne,” Mr Lamers said.
“We’ve also got a seriously hot upgrader market where, in certain suburbs, stock is incredibly tight and buyers are stumbling over each other to get an offer in.
“Yet two suburbs away, you may find a severe oversupply of stock, limited buyer demand and vendors having to aggressively discount asking prices to enact a sale.”
Mr Lamers said that popular suburbs for family include Floreat, Trigg and Mt Claremont, with values rising by over 10 per cent for certain property types, while Alkimos, Baldivis and Ellenbrook are best to be avoided as those areas have an oversupply problem.
The Hobart market is at its strongest point for the last 12 years, and Rob Zubin, REBAA TAS representative from My Property Hunter, expected this momentum to continue through into 2018.
“Hobart and areas particularly in southern Tasmania continue to be a strong and buoyant market as it has been for the past two years,” he said.
“All expectations are that the market will be strong for another 18 months to two years.
“Over that time, there has been significant buyer interest, with limited stock increasing property values.”
Contributing to Hobart’s property market success include a redevelopment of the Royal Hobart Hospital and upgrades to hotels, universities and retail precincts, “contributing to a much more confident economy”.
“The reality is we are seeing more and more people moving to Tasmania for lifestyle plus investors locally and also interstate investing in Tasmania simply because they can’t afford to buy in their own markets,” Mr Zubin said.