Is the property market really that bad?
The mass media are at it again.
“The property market is tanking!” “Real estate is collapsing!” “The bubble is about to burst!”
Panic, panic, panic. Headlines are all screaming blood.
… but is this all media hype? Or are there legitimate reasons to worry?
Here’s my more neutral view as a property specialist, so we can get to the bottom of it all.
Yes, the RBA raised the interest rate.
In June 2022, the new rate is 0.85%.
The Reserve Bank has increased interest rates, with a 50-basis-point hike taking the cash rate target to 0.85 per cent — well ahead of most economists’ expectations. In early May, the RBA lifted Australia’s official cash rate by 25 basis points to 0.35 per cent from 0.1 per cent. This was the first rate rise in 11 years since November 2010, and forecasts are that the cash rate could hit 2.5 per cent by the end of next year.
Hence the initial knee-jerk panic reaction
I totally understand. After all, we’ve had such a low rate for such a long time that Australians have grown accustomed to the stability. Mortgages have never been more affordable and for such a long time.
However, we’re at a turning point now and people are concerned.
It’s also expected that this will naturally flow onto the Australian property market. However, let’s have a bit of a reality check right now.
YES, there will be an impact, however, money and mortgages are still relatively cheap despite this recent rise. This makes it STILL a good time to invest in real estate – especially as we move into what is expected to be a turbulent market going forward.
The real estate impacts I’m seeing first-hand
Working right across Queensland as a Buyers Agent, I’m witnessing everything first-hand – and it’s not as catastrophic as all of the media is leading everyone to believe.
In fact, I believe that now’s a really great time to buy.
In Brisbane specifically, the overall market is starting to balance out a little more as there are more sellers and fewer buyers, shifting the power to property buyers for the first time in a long time.
The market is shifting to favour buyers more
So, despite all of the noise, from what I’m seeing, it’s more favourable to buy now.
You see, when confidence takes a bit of a hit, buyers have more negotiation power. That’s because, in uncertain times, sellers are more motivated to make the sale, rather than wait it out.
And we don’t get more uncertain than what the media is spouting right now! I’m seeing Economists all scrambling on top of each other, trying to “out-panic” one another by claiming that they predict the problems to be even greater than the last.
“I believe the market will fall by 20%!” “I think 27%!” “No no, 30%!”
However, I keep looking back to 2021, when these Economists were all saying, “the market will drop by 30%”, but in reality, it went UP by 30%, meaning that the difference between their predictions and what happened was a 60% variance!
I’ve been a Buyers Agent for a long time, and “the market is collapsing” is always a knee-jerk response and most certainly can’t be just applied to the whole of Australia.
The reality is this: Australia is NOT one single market.
Australia is not one uniform segment when it comes to real estate.
So, while everyone is expecting the whole property market to drop, that doesn’t apply as a blanket statement. Recent stats show:
- Sydney dwelling values declined -1.0% in May, decreased by -1.4% over the quarter and up +10.3% over the last 12 months.
- Melbourne dwelling values declined -0.7% in May, decreased by -0.8% over the quarter and up +5.8% over the last 12 months.
- Brisbane dwelling values increased by +0.8% in May, increased +4.6% over the quarter and rose +27.8% over the last 12 months.
As you can see, the data is very different for each region and city. So, saying overarching statements like “the whole market is doomed” just isn’t true.
What should property buyers do?
There are still many fantastic opportunities out there for savvy home buyers and real estate investors – but it’s important to choose the best options for you.
Just make sure that you do your own research. Don’t follow the “market sheep”. Instead, get out there to observe the trends and look at the stats. Or better yet, speak to a qualified Buyers Agent.
I have many clients who have read a headline saying, “the Brisbane market is down by 1%”, however, when we pulled up the real stats, it was actually up 0.8%!
That’s how a Buyers Agent can help you, despite all of the market confusion.
Are you looking to purchase a property in Queensland?
Purchasing a property on your own is challenging, especially with the media screaming at you like this. There’s so much to consider and so many different factors that can influence your decision.
However, with the right Buyer’s Agent on your side, you can make your property decision with confidence, safe knowing that I’m hunting around, checking all of the latest stats so you have the right expert advice.
So, if you’re looking to buy a home in Queensland, speak to me and my team.
Worth Property Investing will help you buy the right Queensland property
My team and I are passionate about helping you make the right home purchase that will contribute towards achieving your lifestyle and property goals.
Think of us as your property buying partner, here to support you in making the ideal property decisions. As your trusted, licensed Buyer’s Agents, we do everything from searching, connecting, researching, bidding, negotiating and securing the best properties for you.
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