Politicians, COVID, protests and vaccinations continue to grab the headlines in what is certainly ‘Groundhog Day’…but when will it all end?
There’s evidence now that Australians have had enough and whether they trust “the science”, most are succumbing to the fact that they’ll need to obtain the vaccination or many basic liberties may not be made available to them in the future.
In light of all this, the property market is extraordinarily skyrocketing into orbit at levels we’ve not yet seen before.
The most common question I’m receiving from buyers and sellers is …”Where are all of these buyers coming from?”… and it’s a very good question for which we don’t really have any definitive answers.
We believe it’s a combination of factors…
- The lack of ability for those to travel means that there’s plenty of people with more money in their pocket and they’re choosing to upgrade their homes as a result
- Record low interest rates
- The banks are starting to ‘relax’ their assessing criteria since the tightening, post ‘Royal Banking Enquiry’
- Government incentives provided for property purchasers
- Tax relief for small businesses and individuals
- Changing work habits means that there’s plenty that don’t need to be close to the CBD anymore and require larger properties in order to find some solitude when working from home.
The big ‘exaggeration’ we’re being told is that those from New South Wales and Victoria are moving up here in their droves given the extended lockdowns and overwhelming dissatisfaction with how their own State Governments are handling the entire COVID processes.
Official numbers show that their interstate migration is increasing but there’s plenty from Queensland who are also moving to other parts of the country for all sorts of reasons, so the net migration is not as high as what many expect.
Obviously, those currently living down south don’t have any opportunity to inspect properties themselves and given how quickly properties are selling, they either need to make offers ‘sight unseen’ or have a trusted relative make the decision for them.
I’ve noticed that the ones that are from interstate that are trying to buy, seem to hesitate at the time they need to make an offer in order to stand a chance of purchasing.
Despite this, the market is incredibly strong and it must be driven to a certain degree by first home buyers.
And then of course there’s foreign buyers that normally make up a small (but significant) slice of the property buying pool and other than a few ex-pats that are either returning home from abroad or about to return home, this segment of the market has all but disappeared.
So what will happen to our market in South-East Queensland once the interstate borders open up? If you’re following the news over the past few days, there’s reason to believe that this may happen once the country hits a 70-80% vaccination rate (although Western Australia and to a lesser degree Queensland) may not follow suit if we can each do the impossible and keep our community acquired cases down to zero.
So once the borders do open (with current vaccination rates at high levels over the past couple of weeks), the 70-80% target should be reached by November this year, will we see a spike in the property market if interstate buyers can attend inspections without restriction? It’s very likely.
Not to mention the international market…whilst it might be some time away, once we can travel overseas and more succinctly, we start taking in large numbers of immigrants once again, there’s bound to be a surge in property sales although the counter to this factor might be that people will prefer to spend their money travelling abroad when they finally have the opportunity to do so (rather than purchasing a property at a price that’s pretty eye-watering).
It all leaves more questions than answers but the only thing you can be sure of right now is that there’s very few homes on the market for sale and if you’re about to list, you’ll likely achieve a figure that will leave you speechless (provided your agent is skilled in negotiating and handles every enquiry and inspection in the right way), but if you’re buying, it can be a very competitive and frustrating process.
As I’ve mentioned before, I can’t stand a market like we’re in (as extreme market conditions make it very stressful for all parties) and if I could wave a magic wand, I’d love the market to return to a more balanced scenario where buyers had more choices and better options.
Remember, if you need any help or advice, we are just a phone call away.
All the best, Simon