Issue 3 | January 30th | A Stellar Start to 2020!
Hi, Andrew Bell here and I am delighted to be coming to you today from The Event 2020. This is the highest profile marketing campaign for residential properties undertaken each year anywhere in Australia. As you can see, it is a very busy, robust room and it has been nothing short of an amazing day.
I mentioned in previous reports that 2020 has started off on a strong note. It certainly has. The strongest sales activity has been happening in either ends of the market. The most affordable end in the sub $600,000 range and the higher end in the $4+ million range.
There are two factors that have been driving the market. I have already touched on one in my recent reports and that is Australians have worked out that it is crazy for them to leave money sitting in the bank as it earns no interest. With the stock market at new record highs there is a sense that the bubble could burst and so people are tending to shy away from the stock market too. People have also identified that the real estate market went through its price correction through 2018 and a good deal of 2019 and that real estate prices are now very attractive. It has been an easy choice right across the country for people to re-enter the real estate market. There is the old saying, “it is as safe as houses”. There are also record low borrowing interest rates. Today, here at these auctions, we are currently providing the best interest rates in the country with 2.99% for owner/occupiers and 3.64% for investor/landlords. It is also this enormous desire by retiring baby boomers for some quality of life. They are downsizing and many are choosing the Gold Coast as their preferred location to live.
However, there is the other most important side of the equation and that is supply. The latest figures from SQM Research shows the number of homes listed for sale plummeted 30.1% in Sydney over the year to December, and Melbourne by 16.4%. All capital cities also recorded large declines in property listings in December with the steepest drop again in Sydney at 28.7%, followed by Canberra by 28.1%. There are not figures just for the Gold Coast but this decline in the volume of listings of properties for sale is fairly typical throughout the country.
We have this very simple equation. Buyer interest has risen substantially. Realestate.com.au reported that search data by buyers is up substantially. The closest record to us is Brisbane which recorded a 63% increase in searches. So, the buyer interest and demand is up substantially and of course according to SQM Research, the supply is falling sharply. That simple equation of supply and demand bodes very well for a strong year in real estate.
The big lesson to all buyers is to get in fast. No question finance takes a lot more work to secure, but it is obtainable. Money is available. You just need a good broker to do the legwork for you and the next step is to get out house hunting. However, don’t put it off. The longer you wait the more you will pay.
We came to the auction room today with already 12 sold prior to auction and we are witnessing sale after sale occurring here today. We will post all the auction results as they come to hand. We are also going to be left with a mighty lot of buyers who missed out on properties today, so we are desperately looking for more listings. If you are thinking about selling, please give us a call as we have a very large pool of ready, willing and able buyers.
I trust you had a great Australia Day which wraps up our Christmas/New Year holiday season and it is great to see this blessed country once again receive large volumes of rain to help in the recovery from our fires. Proud of you, Australia. You excel in challenging conditions.
That is all for today as I have to get back up and complete the balance of our auctions for The Event 2020.
Andrew Bell, OAM
Chief Executive Officer
The Ray White Surfers Paradise Group