Looking To Sell? Here’s Why There’s Never Been a Better Time
It may be borne from too many months spent working from the dining room table, a need for more space, or that 2020 made many realise now is the time to live the beachside dream, but Australians are selling up - and getting more for their homes than they thought.
Up-sizers seeking more room to live and work and downsizers looking for a lifestyle change are causing property prices to grow, right across Australia.
New data tracking the nation’s property market from leading property data provider CoreLogic has revealed demand for city homes is outstripping supply, leading to increased prices of 2.8 per cent across Australia.
In the last three months of 2020 dwelling prices increased 2.8 per cent, despite the impact of Melbourne’s lockdown and outbreaks in Sydney, Brisbane and Adelaide.
LJ Hooker’s Head of Research Mathew Tiller said property prices for dwellings were up across the whole country, with regional areas leading the charge.
“Over the year in pretty much all the capital cities, houses have outperformed apartments for price growth,” he said.
“With people being locked down, they’ve realised they need more space. They might work from home and need an office, or somewhere where they need to educate the kids for home-schooling.
“Owner-occupiers and first home buyers have led the charge, over the last 12 months, particularly for newly built housing stock.”
Prices are climbing around the country. For the capital cities, Darwin led the pack with a 5.5 per cent increase in prices. Adelaide, Canberra and Hobart all recorded increases of more than 3 per cent in the final quarter of the calendar year 2020 (3.6 per cent for Adelaide and 3.2 per cent for both Canberra and Hobart).
But it was regional areas that were the standout, with price gains higher outside the capital cities than in Australia’s urban population centres.
CoreLogic data shows that properties in regional New South Wales, Queensland, Tasmania and the Northern Territory, all increased in value by more than 4 per cent from September to December 2020.
Mr Tiller said record low interest rates were a major factor in the rising market, allowing more people to enter the market and upgrade.
With the Reserve Bank’s official cash rate at 0.1 per cent and the average bank loan at 2.8 per cent, more people were realising their housing ambitions.
He said people were also paying down their mortgage faster – perhaps they kept the same repayments as interest rates dropped, or they put their holiday money back into their offset account - prompting them to look around at the property market.
“It puts more equity in their hands so they can go and look for that second home, or they can upgrade to a higher quality home more quickly than they would have,” he said.
Buyers are keen. According to CoreLogic data, there were 8 per cent more properties sold in 2020 than in 2019.
Despite this, fewer properties were listed for sale. Last year there were almost 20 per cent fewer properties on the market than in 2019.
The reduction in supply combined with the increased demand has led to the increased pricing, especially for houses.
Mr Tiller also pointed to the impact of government stimulus measures – especially for new builds – and first homeowner concessions.
He said first homeowners, in particular, could save up to 8 per cent - depending on the state - of the property’s price thanks to state and Australian Government grants and tax rebates.
And local agents are seeing the trends at their inspections across Australia.
LJ Hooker Seaforth Principal Tim Wirth said demand for properties in Sydney’s northern beaches was strong with very tight stock levels compared to the number of people who wanted to buy in.
“We’re definitely seeing there is turnover but the average home is selling in less than 30 days, which is testament to the strength of the market,” he said.
People upgrading for more space, or families wanting to move from an inner-city apartment or semi were seeking bigger houses and outdoor areas.
Some need to move to a place where they can have a home office, citing the case of a man who was working from home from his garage until he moved.
“For those who are used to working in the city five days a week, now when you’re literally spending seven days a week at home, having a dedicated home office and a separate work space is becoming more important,” he said.
And he said the market was only growing. He said he expected this year to bring more demand and higher prices.
“I wouldn’t be surprised to see 10 per cent as a realistic figure [increase] for the beaches,” he said.
“I think demand is going to continue to outstrip supply substantially, which means prices have to continue to be pushed up. It’s the lifestyle.
“If you’re looking to sell, in the beaches or elsewhere, now could be an ideal time.”
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