Based on Reported Auction Results*

Property Market Correction Takes A Proper Hold

The year has ended with a whimper. Auction success rates are now declining to levels going back several decades.

There’s little doubt that prices in the major cities have reached elevated highs. The time has arrived for a breather to allow an exhausted market to catch up. However a severe toughening by banks on lending has cracked the whip and resultant brakes slowing the market down have been applied much more aggressively.

To answer the questions of how much further and how sustained the current correction will endure, one would need to know how long tough (or tougher) lending policy by banks will remain. We are now only at the start of these more difficult settings: one cannot imagine there will be any relief in the near future from this quarter.

As many property transactions are not vitally dependent upon mortgage borrowings, the market is only “partially” affected. But the flow-on effect is inescapable and if there is weakness at the bottom of the market it will usually translate all the way to the top. In the current lending tightening however, no one is immune and top end borrowers are also having their wings clipped when seeking funds.

On a positive note, for those home buyers who will be out there looking to buy in 2019, broadly speaking, market values will be down on 2018 levels by 10 to 20% we believe. Waiting can have its advantages!

Vendor Advocate (Seller’s) Service

For sellers of property we offer a no-cost-to-the-seller vendor’s advocate service which has included use by many of our past clients, when moving on. This service will ensure you, the seller, keep selling costs down and make sure you have the right selling agent looking after your sale. We also liaise with your selling agent during the sale to maintain top level communication at all times to obtain the best price outcome for you …. We will say more about this service in 2019, but if you would like more information before then, please see our “Services” page and contact us directly.

To all clients and readers, have a very Merry Christmas and a Happy New Year in 2019.

Best Wishes,

Bruce Renowden