The Weather Forecast
Wednesday 20 Nov 2019
Given the extraordinary weather we have been experiencing over recent days, it might seem a little odd to learn that a common concern amongst my industry colleagues is that the local property market might be experiencing its own unique kind of ‘Indian Summer’. And whilst we would all welcome a cooler change in the weather, especially to give much-needed respite to the amazing rural firefighters, a forecast of cooling property demand is not so welcome, so it is time to act now.
It’s fantastic that the market has turned around, demand is high and values strong but I’m worried because there appears to be an assumption the positive sentiment will automatically continue to build and generate growing returns.
Of course, I’m always happy to hear reports that the market adjustment is over, that the future looks bright and we can all strap in for another ride to record-breaking growth and returns in 2020.
But I think it is important, to be honest. And honestly, I’m a little nervous because I’m not so sure that growth is guaranteed. My concern is that potential vendors are missing an opportunity to secure a great deal now because they are expecting a greater windfall in a few months.
I don’t want to be a prophet of doom but realistically I’m not so confident that the positive market we are currently enjoying will continue its dramatic rise into the new year. A potential flood of listings onto the market in February and March next year would be at risk of running headlong into post-Christmas economic headwinds of low wage growth and declining business confidence.
In my view the downturn we saw this year wasn’t the real thing. It was certainly serious but it was a nervous response to lending regulation changes and the banking royal commission rather than a systemic adjustment to broader circumstances. Which is why I think the recovery we are enjoying now may not last as long as we would all hope.
It is for that reason that I feel the best advice I can give is to make your decision and get your property on the market now. Right now. In the current climate, our team are delivering great returns. Morton Agent James Crow secured a sale last week of $1.22 million for a client where the reserve was set at a very healthy $1.1 million. That is the sort of opportunity that exists at the moment and savvy owners are seizing it.
Look. Don’t get me wrong. I would love to be wrong. As any weather forecaster will tell you it’s hard to get it right every time but it would be remiss of me not to issue the warning. Over these extraordinarily hot days, our firefighters have asked that we be prepared and ready to act. I would offer the same advice to anyone considering putting a property on the market.