It’s always helpful to look at the national real estate market to get a general sense of the attitudes and experiences of both the buyer and the seller.
While we caution you against associating national numbers with sales results in your area, all local markets can be affected by national trends and confidence in the economy’s short to medium-term future.
The latest industry numbers from industry researcher CoreLogic indicate a steady transition from a record-busting seller’s market to a more balanced situation.
On the ground, buyers no longer display the exuberance of the past two years, and a percentage have withdrawn from the market.
That’s because mortgage costs have risen from 0.1% at the beginning of the year to 2.6% as the Reserve Bank of Australia tries to stem the nation’s inflation rate.
Inflation is predicted to peak at 7.75% later this year – a far cry from the 2-3% target the country has achieved since 2011.
This economic cocktail has turned home prices south, according to CoreLogic’s latest Home Value Index.
For buyers and sellers, there can be an upside to falling prices. Those looking to upgrade their property might receive less than anticipated for their current property but pay less for their next home.
First-home buyers have a lower barrier to entry if they can meet the current mortgage costs. Once inflation has been pulled back and interest rates reduced, they’ll be in a healthy position.
Below, we’ve listed some key points in the CoreLogic report. We hope you find them interesting. If you’d like to discuss selling your home and accessing local results, please do not hesitate to call us.
- Sydneysiders enjoyed an average rise in property values of almost 30% in the past two years. CoreLogic says that translates in dollars to $252,900.
- But the city has also seen the biggest fall from its price peak, with the nation’s most expensive market falling 10.1%. The average value of a home is down $116,500.
- Melbourne (-6.4%) and Brisbane (-6.1%) have experienced similar dips in values since their respective peaks in January and June.
- The most stable markets are Adelaide and Perth, each declining at less than 1%.
- Darwin is the only capital city where values have not fallen. However, CoreLogic believes its 10.1% tumble in 2014 indicates an undervalued market.