Issue 19 | September 14th, 2017 | Andrew Bell’s Market Wrap: A Cause For Celebration
We have just concluded our Ray White awards season and it was a thrill to have been recognised on so many fronts once again. Apart from being recognised as Queensland’s Number 1 residential sales office and Number 2 commercial office, it was a landmark year with just over $1.2 billion in sales. This does show, not just the strength of the market with its sale prices, but most particularly the huge volumes of sales that we generate here on the Gold Coast for our clients. There were lots of individual awards and far too many to individually highlight.
GOOD NEWS FOR AUSTRALIA’S ECONOMY
On the economic front – some good news. It might be strange for an employer to say this, but we have just seen the strongest wage growth since 2013. Robust income growth, if continued, will help keep the household sector spending, boosting consumption that counts for more than 60% of the economy and supporting employment growth. It is interesting to note, that at the same time we see this information on wage growth we also saw very mixed results on business profits, which saw quite a number of sectors hit with a drop in profits. This is a mixed message for the Reserve Bank to absorb when considering interest rate movements.
Some great news also out from the Reserve Banks Governor, Philip Lowe, who expressed confidence that the Australian economy is strengthening. This was off the back of strong export growth and infrastructure spending. He felt this would feed through into further wage growth which is essential as he said the Australian consumer has been missing in action this year with a greater focus on paying household bills. Without consumer spending the economy cannot grow, so his confidence is somewhat reassuring. He also said that the Reserve Bank was now comfortable that Australian banks in general are now comfortably within limits imposed by regulators on lending. The Reserve Bank Governors are very cautious about what they say so to have mentioned this is a pretty strong statement.
We also have Core Logic’s latest report showing that national dwelling values remain flat during August which of course is no surprise with winter months usually our quietest months of the real estate calendar. However, head of Core Logic Research, Tim Lawless, does suggest that the most recent figures is evidence that the housing market has moved through its peak growth phase.
Pleasingly, if we have gone through the peak growth phase, it is showing that we have gone into a reasonably smooth transition to a steady market and it is great for the real estate market to have a period of consolidation. It is certainly a great time for buyers who have not just set aside their housing requirements to get into the market as there should start to be a better balance in supply and demand.
We are starting to see stock numbers increase, as usually happens in spring, with larger numbers of sellers deciding to capitalize on this period of time to adjust their own housing requirements. This is further good timing for buyers who would like to be into new homes before Christmas or indeed to consolidate their investment options early in this financial year.
REAL ESTATE CONTINUES TO SURGE
The number of properties selling for more than $1 million has continued to grow right throughout Australia as real estate continues to be the preferred safe house for our hard earned money. The numbers of properties getting into the 1 plus million dollar bracket is no surprise as a result of the 77 percent increase in value over the past 5 years of in Sydney and 61 percent in Melbourne.
Sydney dominated capital cities in terms of dwellings of $1 million or more in value; registering 47.8 percent of houses and 21.3 percent of units. Melbourne registering 25.9 percent of houses and 7.4 percent of units and the nearest location for the research to the Gold Coast is Brisbane; recording 7.9 percent of houses and 2.8 percent of units. Real estate has also made many, many Australians multi-millionaires purely through their real estate holdings and not necessarily their incomes.
$3.1 RAISED FOR MUSCULAR DYSTROPHY
Thank you to the near on 750 people who joined us last Saturday night for our 25th Ray White Surfers Paradise Muscular Dystrophy Ball. It truly was a fabulous night, attended by the Honourable Kate Jones Minister for Education and Minister for Tourism, Major Events and the Commonwealth Games, Mayor Tom Tate and Deputy Mayor Donna Gates along with a host of other leading business entities here on the Gold Coast.
We raised over $160,000 on the night and we are now as far up as $3.1 million as a total raised in the fight against Muscular Dystrophy and I thank so many for their generous support.
I look forward to catching up with you in a fortnight’s time. Until then, stay safe.
Andrew Bell, OAM
Chief Executive Officer
The Ray White Surfers Paradise Group