PROPERTY UPDATE

Will a change of season also affect the property market? Anji Foster from Lowe&Co reports.

Almost like clockwork, from the first of September the tuis return to the eucalyptus tree in our garden in their numbers! We’ve seen up to ten of them at a time making a racket and entertaining us with their flamboyant flybys and swooping chases. It’s a sign that spring is upon us.

What is less reliable is the spring effect on the property market and it is still unclear whether buyers will be flocking back to the market in September, or whether they will hover back in the wintery shadows a little longer.

The recent official cash rate decrease (the first downward move since March 2020) is certainly a promising sign. Without doubt, a stronger factor for the market than spring is interest rate decreases when it comes to buyers getting active, and so the figurative eucalyptus tree might start to liven up a little after this announcement.

In the meantime, the Mount Victoria market remained stable last month, with 0% monthly increase on the median sale price in our neighbourhood. We wouldn’t normally celebrate 0% but when comparing to the 9.8% decrease Mt Vic has seen over the past three years, remaining stable seems like something to feel good about.

This 0% change is also reflected in many of the other data points we look at. Days on the market and median weekly rent are static from last month at 32 days at $580 respectively. Through a tumultuous time globally, things remaining the same seems somewhat comforting, and when it comes to the property market is certainly better than the alternative!

A stable market is good for both buyers and sellers. It might be hard to believe, but I don’t get the sense that sellers enjoy feeling that they are profiting from people over stretching themselves, and equally don’t get the sense that buyers want to feel like sellers are haemorrhaging cash when they sell. A win-win negotiation always ends best, and I believe that we are seeing more of those commonsense negotiations currently.

Homeowners lost a lot of paper money in 2022 and ‘23, but many sellers have now recalibrated and come to terms with current market conditions and values. It is toughest for those who bought in 2020 and ‘21 when premium prices were being paid, but most of the clients I am working with are selling for more than what they originally paid.

For buyers, the conditions have been against them in recent times, but now that we are seeing the market we have as the ‘new normal’, they are recognizing that paying fair market price for a good home is what is required to secure it. Properties with issues, whether that’s difficult access, deferred maintenance or unpopular construction methods can still be sticky, but good homes in good areas are selling for good prices.

Of course, a balanced market is usually the precursor to something swinging in the other direction and interest rates might be the start of that swing; watch this space. In the meantime, I’m looking forward to the predictable return of the tuis.