December 2013 - Year of Growth and Green Lights for 2014! propertybuyer Market Update
By Rich Harvey, Managing Director propertybuyer
Welcome to your December edition of propertybuyer's market update. It's been a strong year for propertybuyer and we want to wish you a very Merry Christmas and a wonderful New Year for 2014.
In this edition we look at:
- Year of Growth and Green Lights Ahead for 2014
- International Award Winners
- Client stories
1. Year of Growth and Green Lights Ahead for 2014
Renewed buyer confidence spurred on by historically low interest rates, a new federal government and continued undersupply has seen property prices surge this year – especially in Sydney. Since early January we have had strong buyer inquiry for a wide range of areas.
Investors have returned strongly, chasing high yield and capital growth areas as borrowing rates make it very attractive. Home buyers have been very active this year – particularly in the second half of the year as more properties came on the market where vendors are more confident of achieving a solid sale and being able to find a replacement home.
The Australian housing market was booming due to buyer activity during 2013, according to a recent report from Australian Property Monitors (APM).
Data from APM shows that the national median house price is set to rise by 5 per cent at the end of 2013, spurred upward due to high demand buoyed by low interest rates and rising confidence.
Sydney was the standout performer with median house price growth expected at +11% for 2013, followed by Perth and Hobart each with +8.0%, Melbourne and Darwin both +7.0%, Brisbane +3.0% and Adelaide +2.0%. Canberra median house prices however are set to fall by -2.0% over 2013. Only Sydney, Perth and Darwin will have recovered to previous peak-levels, and all other capitals will remain below their previous house price peaks recorded in 2010 with Brisbane clearly the outlier still five percent behind.
This activity has especially been evident in the Sydney area.
"The Sydney housing market recorded strong levels of buyer activity through 2013 with record levels of buyer and seller activity reported during the spring home auction season," the APM report stated.
Median house prices in Sydney increased by over 10 per cent during the year, reaching a record-high level of more than $700,000.
The activity was felt at all levels, from the budget market to mid-priced houses.
APM also forecasted that house prices will continue to see strong growth in 2014, with prices expected to rise between 5 and 7 per cent, with most of the increases predicted to occur during the first half of the year. This suggests buyers are better off to enter the market early in the year than at the end of the curve.
However, it is not expected that prices will rise at the same surging level experienced during 2013. The report highlighted a weakening economy that will moderate price growth. If unemployment rises further, the RBA may consider cutting rates further (and also alleviate pressure on the Aussie dollar).
My prediction is that the real estate market will see continued growth in selective areas throughout 2014. Not all areas will rise in value. Only those areas that have the right fundamentals in terms of amenities, lifestyle, property types and proximity (i.e. high demand, low supply) will prosper most.
While some say the Sydney market has peaked, I say it still has a considerable way to go. The growth curve will flatten out, but highly unlikely to go backward in 2014.
If you are in the market to buy a property, please call our office on 1300 655 615 to discuss your requirements, or email your enquiry. We would be delighted to help.
Rich Harvey is founder and Managing Director of www.propertybuyer.com.au, Australia's most awarded Buyers' Advocates. Propertybuyer helps property investors and home buyers search and negotiate the right property at the right price, everytime. Visit www.propertybuyer.com.au or call 1300 655 615.
2. International Award Winners
I am delighted announce that propertybuyer received two awards at the Overseas Property Professionals (OPP) Awards for Excellence held in London last night.
Held in front of a large crowd of 450 people from over 20 countries, propertybuyer was awarded:
“Best Investment Advisor” Gold award and
“Best Supporting Service” Bronze award.
The OPP Awards for excellence are judged by a panel of highly experienced judges that give their time to the awards because they know that they are based on merit, not just given to known organisations or the biggest advertisers.
I would sincerely like to thank all of our clients for their continued support of our business and believing in the Buyers’ Agent concept. I would also like to express my gratitude to our fantastic team of buyers agents and support staff for their dedication and commitment to excellence.
3. Client Stories
Here is a selection of feedback from some of our happy clients last month:
"....emotional support was invaluable"
Brian L, Group Head OH&S
Buyer type: Homebuyer
Buyer's brief: Family home with renovation potential
To secure a family home within a price limit that we set in the original brief. We felt overwhelmed, we are working professionals with 2 young kids and organising things from the perspective of inspections, auctions etc would not work. Our main worries were time, hassle of dealing with agents, being taken for a ride by agents, the hidden items such as pest and building, lawyers, surveyors, engineers etc.
Simply put, Matt Corbett solved things and took care of all those things listed above. In addition, his emotional support was invaluable. Afterwards we felt grateful and satisfied for having had Matt on board “to hold our hand”. Having someone like Matt when you are “buyer” was as critical as having a trusted agent on board when you are selling.
"…having someone like Matt on board was critical"
Buyers' Advocate, Matt Corbett
Brian & Ana were looking for a family home in and around Northbridge. They were happy to purchase a house in good condition, but equally comfortable in securing a property with renovation potential. After considering neighbouring suburbs as an alternative to the very tightly held Northbridge, they concluded that Northbridge was indeed a preference. After extensive research and contacting all of the local agents we ended up securing a property at auction. It was well located with excellent potential and city views. Of additional comfort was that Brian & Ana knew that their extension & renovation plans would not be over-capitalising in the area.
"I'm confident i've purchased a great investment"
Mike F, Naval Officer
Buyer type: Investor
Buyer's brief: 30km outside of Sydney CBD, low maintenance with access to a combination of good yield and solid growth
My property goal is to retire young, an entirely financial decision, looking for strong capital growth potential, reasonable yield, and good purchase price. I felt entirely capable of doing it myself, but confident that I would be better off with professional advice. I was worried that I would pay too much, or that I wouldn’t be investing in the best area for capital growth potential.
Kevin found me an off-the plan unit in a great area. By the time we had exchanged contracts, identical units in the complex were selling for 22k more than I had paid. Kevin also negotiated 9k off the deposit. The amount that propertybuyer saved me on the purchase covered both their fee and my stamp duty costs. Because of the research that Kevin showed me, I’m confident that I’ve purchased a great investment for an excellent price. As an investor I’m confident that I made the right decision in using a buyers agent. propertybuyer did everything that they promised they would and I have secured a much better deal than I could have alone.
"Propertybuyer did everything that they promised they would...."
Buyers' Advocate, Kevin Mason
Mike required assistance in regards to where and what to buy. After designing a strategy for Mike in regards to finding an area that can provide both solid yield and growth, I was able to secure an excellent opportunity, in fact, Mike has already picked up growth on the property as soon as we exchanged contracts. A combination of utilising our trusted networks, invaluable research, obtaining a discount on this prime property and local knowledge have all assisted with Mikes successful purchase.