Issue 11 | May 23rdh | Election Results Cool Real Estate Concerns
Hi, Andrew Bell here and I have quite a few interesting pieces of news for you today. I will provide those as we look over this magnificent home at 1a Yacht Street, Southport. Another one-of-a-kind here on the Gold Coast.
What an impressive home and I am sure you will agree. It is a Hampton’s style masterpiece. Located in one of the most sought-after enclaves on the Gold Coast with blue-chip main river position. Our owner has committed elsewhere and needs this property sold on or before auction day. The home is on over 970m2 with a 20m frontage to a wide section of main river with stunning views back into the city. At night, the views are breathtaking. Go your hardest and try and find anything else on the Gold Coast like this and you will find the answer is…there is none. The home has 5 very large sized bedrooms, 4 bathrooms, theatre/games room, home office, plus outdoor alfresco entertaining, all leading down to the sparkling pool and the floating pontoon which is superbly positioned to accommodate a 65ft vessel. The kitchen is a chef’s dream. There is a wine cellar and scullery, as well as a separate and quite amazing master wing with sitting room, a huge ensuite, walk-in robe and private balcony. This home was built with loving care and meticulous attention to detail. You will find nothing wanting. Do yourself a favour and contact our Marketing Agent Jackson Paradise to make a time to inspect this property.
Contact: Jackson Paradise
0402 692 544
One of the things I have learnt about real estate is you don’t get to choose when a masterpiece becomes available, but you must be ready to seize the opportunity, and these are moments when opportunities must be seized. Come! Inspect! Be amazed!
It is great to see our rating agencies have again confirmed Australia’s AAA credit rating, making us 1 of only 11 countries in the entire world with such a high rating. Whilst our politicians love to point out any shortcomings in our economy, we should remember that we have one of the better economies in the entire world.
I have shared with you over many years the key drivers of the real estate market: GDP, unemployment, interest rates, population growth, housing affordability, and the ever-changing balance between supply and demand of real estate. Well, I don’t think it is news to anyone that the demand for real estate eased over the past 18-months. That was partly caused by the credit squeeze of 2018 where investment buyers were almost completely blocked out of the market due to their inability to get finance. For home buyers, the criteria to get a loan was also so tough that it squashed the buying demand of many owner-occupiers. The risk was that if supply continued as it was, we would have a significant imbalance with a flood of properties and few buyers to buy, which ultimately would have meant significant falls in prices.
As buyers in the marketplace will tell you today, there is very little volume of property on the market to choose from. Sellers aren’t under any financial pressure and so many are just choosing not to list their properties for sale at all. However, the biggest supply in the overall real estate market comes from new housing construction, and this is a real eye-opener. Construction has fallen sharply and will be down 30% from its peak with construction levels dropping to around 131,000. This huge drop in construction is likely to be with us for another 2 years according to BIS Oxford Economics.
The pullback in new home starts will be greater than the average 25% decline seen across the past 9 construction downturns since the mid 1970’s. This certainly means we will have less supply of new homes which means it drives buyers back into the resale market. Those most recent official figures also show a 16.3% decline in new starts in the 3-months to December just passed.
We can see that the balance of supply and demand is starting to give signals of an undersupply developing and that will be exacerbated now that finance is starting to flow again, and with the spring season coming when traditionally we get a significant upswing in buyer demand.
Well, now the election is over, it removes two of the issues that were putting a brake on the real estate market. The first was the actual election itself where people wanted to wait and see what the outcome would be and if there were any significant policies that would affect them personally one way or the other depending on who got in. The second was that if Mr Shorten had got in and negative gearing was to be removed, there were significant concerns about how that may affect the real estate market adversely. With the election now done and dusted, both those issues have been put to bed and so we can expect people will now see the real estate market in a much more positive light than they had for well over 18-months.
I am sure you, like me, will be very glad that all the election ads are off our TV screens, out of our newspapers, and we can get back to enjoying a magnificent lifestyle we have here on the Gold Coast. To that end, I wish you a wonderful fortnight ahead and I look forward to being with you in 2-weeks time.
Andrew Bell, OAM
Chief Executive Officer
The Ray White Surfers Paradise Group