There has been a lot of talk this week regarding the economy and where it is heading for 2015. In particular, there has been a lot of discussion on the Australian housing market while the economy is thrown into the spotlight as we embark on a new year.
January is the time we reflect on the year that was, make new resolutions and when the ‘best of’ articles start to circulate. No matter what the content – shares, property or even celebrity gossip, we stop to recap on the previous year and start to look ahead.
We have clocked over to 2015 and reflection is inevitable, especially in the investment and economy sphere – but does there come a point when reflecting and predicting is unhelpful?
It seems that all this information is putting a haze over the economic world. Analysts are forecasting property and economic information and as an everyday consumer, I’ve seen my behaviour start to change - even just slightly. I’m wondering when the best time to lock my mortgage into a fixed rate is and when I should change over some Aussie dollars for my overseas holiday? I’m yet to do either because there is so much forecasting information coming through – I don’t want to act too soon and it’s too hard to wade through it all.
Whether it’s holding off planning an overseas trip because you’re waiting (fingers crossed) for the Aussie dollar to bounce back, or not purchasing a property because you are hoping rates or prices will drop, it seems that at this time of year, reflection can so easily take over from making decisions. Clearly as a community, people are out buying and renting property. The key is: don’t do nothing.
As an active buyer, seller or investor, it can be difficult to determine exactly when the best time to act is. The age-old question is: When is the best time to get into the market? This past week has certainly added a layer of haze in the decision-making process. Interest rates, the Australian dollar and general news on the property market appears to be adding confusion and making it difficult to dissect the information from all the noise.
As agents, we are in the field every day. We see first hand what is happening at the buyer, seller and tenant levels of the market. Whilst we are not in the forecasting space, we do know what is happening right now – in terms of numbers of people attending our open homes, what areas are the most popular and what the feedback is from buyers/tenants.
So what are we seeing on the ground?
Buyers are swarming quality properties. One of our sales partners alone saw over 126 groups through his properties this past weekend!
On the investment side, the demand for high-end properties is extraordinary. There are simply not enough available to meet the current needs of our clients. The relocation activity at this time of year has further heightened the already tight market. One of our properties in Greenhill was leased in a staggering 12 hours for $950 per week! We spoke of the high-end market at the end of last year, but it seems things have tightened even further. This is great for our investors, but unfortunately there are a lot of quality tenants who are missing out.
Applications are coming through thick and fast with upwards of eight being received at quality properties. We are also seeing ‘stickier’ properties that have been on the market for a number of weeks starting to move.
These are very positive signs for investors, and from this level of demand and activity we are seeing rents move upwards. Around our seven offices and leasing hubs it’s not uncommon to see multiple applications coming in offering $10-$20 over the advertised rental price.
There are macro-economic factors at play in any market and they are ‘must-use’ guides. It’s when the information creates a haze of confusion, and stops you from otherwise acting in the market that you can end up missing out on great investment opportunities. Time to exchange my Aussie dollars...