It’s all over the news, across social media, and discussed at every dinner table: interest rates are on the rise, global factors are conspiring to exacerbate inflation and the real estate climate in Australia is changing. Yet, remarkably, what we’ve seen here in the Lower North Shore is a positive and balanced market. Let me explain why I think this market is better than the rambunctious market of the past two years.
You might expect a real estate agent to tell you that the last two years – full of gloriously high prices and fervent bidding from insatiable buyers – were a better market than the more fettered market of today. Well, not me. This market is a preferable market for all.
The simple fact is people buy and sell houses every day. Whether to upsize, downsize or move away, everyone’s circumstances are individual. Selling or buying is an inherently personal decision, whether motivated by financial, family or for the thrill of experiencing a new neighbourhood, location or view. Macro economic factors play a part in how the market moves, absolutely, but people affect property prices more than any other factor.
Yes, the global economy is in decline, electricity prices are soaring, there are supply chain issues… but the real estate market on the Lower North Shore is still strong.
We’ve looked at the number of properties we’re selling, month in and month out over the past year. The number hasn’t changed. Sure, the prices may have come down slightly, there may be fewer bidders at auction, and sometimes less enquiry, but the upside is the enquiry we do get are those ready to buy.
This is what we’re currently experiencing and why the market is a good space to trade in for buyers and sellers alike. It is the most level playing field we’ve seen in the last two years.
What is a better investment than property in these precarious economic times?
The recently released Census revealed Australia’s unparalleled run of economic growth may have ended in 2020, but the reality is that we are still powering on. The last two years included a global pandemic with major government influence that put a lot of cash back into the economy. People have invested into the stock market, Crypto and other cash markets. Traditionally, when stock markets have fallen, people invest into property, but again we must wait to see what people will choose to do in times of uncertainty.
We’re all acutely aware of the horror stories for investors across multiple asset classes:“Crypto bank on the brink of collapse”, “stock market dipping”. What’s more worrying is a prolonged period of high inflation. This will no doubt lead to lower rates of household saving and may potentially weaken a prospective borrower’s ability to meet lending criteria. Nevertheless, our business is focused around selling real estate and that cash investment we know is still ticking away quite nicely.
I’ll leave you with one final thought: none of us have a crystal ball. The only certainty is the market we operate in today, and it’s the most balanced market I’ve seen in three years.