The Real Estate Buyers Agents Association (REBAA) today reveals its predictions for the 2020 spring property market.
- Regional property locations will continue to perform strongly over spring as families, relocating workers and retirees looking to optimise their superannuation savings opt for a regional owner-occupier change. Investors will also be attracted by the appeal of strong regional city capital growth rates.
- In NSW the combination of low interest rates and pent up buyer demand is expected to result in continued upward pressure on prices, particularly in the more established blue chip and gentrifying inner-city suburbs.
- In Victoria a delayed start to the spring property market is expected once Stage Four COVID restrictions are eased, possibly in mid-September. The relative supply and demand ratio should keep the property market relatively resilient.
- In Queensland sea and tree change locations will be in high demand as many agents report a record number of appraisals completed in previous few months. Strong performances in the Brisbane luxury property market and at the lower end close to the city, are also expected to continue.
- In Canberra it will be the upsizers who move most this spring, closely followed by first home buyers competing for entry-level homes as they look to take advantage of lower interest rates.
- In Adelaide significant investor activity from local, interstate and overseas buyers is expected to continue as they realise the value combined with extremely strong returns. Families looking to secure a home within 10km of the CBD will also be strong contenders.
- In Tasmania first home buyers and owner-occupier upgraders are taking advantage of low interest rates and government incentives. Steady buyer activity across the stock with low stock levels is putting upward pressure on prices, especially in the sub $550,000 bracket.
REBAA president Cate Bakos said buyers with stable incomes and approved finance were in the driver’s seat to take advantage of the property market this spring season.
“Our philosophy remains the same, there are opportunities in whatever market you decide to buy in,” said Ms Bakos.
“There is no doubt Melbourne will be the most impacted market in Australia in terms of timing, auction activity and stock volumes as a result of COVID-19. For the first time ever, the first two weeks of spring will see zero auction activity in the garden state.
“Agents have been banking up willing vendors’ listings and we anticipate when the restrictions are lifted that buyers will have more options than the miserably low listing levels they faced in winter before Stage Four Lockdown struck.
“Buyer energy and frustration is palpable; a sure sign that transactions will commence as soon as the gate is opened. If you have the money and job security, and are keen to buy, now could be a great time. And if you’re anxious about conducting your due diligence think about enlisting an independent buyer’s agent to do it for you.”
According to REBAA NSW spokesperson Ramon Mitchell from Gault & Co a chronic undersupply of established residential properties over the past six months has left many buyers anticipating the spring selling season with ‘bated breath’.
“There are still a good number of vendors who have elected to maintain the wait-and-see approach and who are holding off listing their properties for sale,” said Mr Mitchell.
“This is particularly true of those vendors located outside Sydney and those holding B-grade investment assets where their fears of losing money may not be entirely unfounded as the market becomes more discerning.”
In Melbourne many sellers are sitting on the sidelines waiting for the best time to put their property on the market, according to REBAA VIC spokesperson Leigh McConnon from Buyers Advocate.
“Many of the them need to sell because of their financial circumstances or they may have already bought and this is their last opportunity to sell prior to Christmas,” said Mr McConnon.
“You can expect the agents to be working the prospective vendors as they also have experienced a lean year. On the flipside there are also a number of buyers who are ready to transact but the majority are unlikely to purchase until they can physically inspect the property.”
REBAA QLD spokesperson Scott McGeever from PS Property Advisory said demand for coastal and hinterland property was likely to increase over coming months.
“Many people are realising they can live anywhere while working from home and are choosing to move to lifestyle locations,” said Mr McGeever.
“This has seen listings that couldn’t be given away a few years ago, to no listings and a tight market. If the product is right then buy it, but make sure the price is right. With fewer sales occurring, it’s more difficult to establish value.”
In the nation’s capital the biggest challenge for buyers this spring is not to fall foul of FOMO, says REBAA ACT spokesperson Claire Corby from Capital Buyers Agency.
“Freestanding homes have seen strong growth while units continue to lag and be plagued by ongoing issues of questionable quality,” said Ms Corby.
“Throughout COVID-19, Canberra buyers have been extremely confident and keen to make purchases to suit the changing criteria of what their home should provide to accommodate their working from home arrangements.”
In Adelaide where prices have held firm throughout COVID-19, agents are gearing up for a surge in listings says REBAA SA spokesperson Katherine Skinner from National Property Buyers.
“This will come at a great time as buyer demand is sky-high right now,” said Ms Skinner.
“In Adelaide we’ve not seen any true downturn in the market and in many pockets there has been a spike in prices due to extremely low stock levels and demand over the past few months. We’re warning buyers to be diligent and to educate themselves fully on the market they’re looking to buy in as the market is expected to move quickly.”
REBAA Regional spokesperson Matt Knight from Precium Property said regional Australia would perform strongly as we move into the warmer months and the appeal of a coastal or hinterland retreat becomes more attractive.
“With the warmer months ahead, we may see an increase in demand for coastal locations as more people realise the benefits of living and working in a lifestyle location.
“Increased activity from first home buyers seeking to leave the capital cities has also seen increased demand even for smaller homes in regional locations and those requiring renovations.”
In Tasmania buyer activity is back to normal but low stock levels are putting upward pressure on property prices especially in the sub $550,000 bracket according to REBAA TAS spokesperson Bryan Loughnan.
He predicted once the borders were open there would be a resurgence of strong domestic migration and tourism to Tasmania which would drive the economy and employment growth.
“Hobart, Launceston, Burnie all have healthy buyer competition and we’re expecting that momentum to further accelerate over spring. First home buyers and owner-occupier upgraders, in particular, are taking advantage of low interest rates and government incentives.”