Turning back the clock

Turning back the clock

Whilst many would like to turn back the clock with the benefit of hindsight, there is no denying that the property market has withstood the test of time. There is a noticeable difference within the property industry, as vendors become purchasers at the drop of a hammer. Such is the loyal allegiance to bricks and mortar, steadfast in their resolve that when it comes to building wealth, their code of conduct is driven by a post code. There are just a few significant post codes, and 2088 is one of Australia’s stars. Australia’s rising home prices now lead the world, with the recent figures identifying the biggest yearly increase since the boom of 1989. The Bureau of Statistics has just released the statistics for the year to June 30, with Sydney leading the way with a 21.7 per cent increase, Brisbane finished a close second with a 21.3 per cent increase. Britain recorded a respectable 18.8 per cent increase, and Spain posted a 15.7 per cent increase.

Many argue that over the last four years property prices have jumped 70 per cent, but it will be the investment market that remains under the microscope, given that they accounted for more than half of the increase in new housing loan approvals. Many investors are finding it increasingly difficult to fund their new acquisitions given that tenants still remain few and far between. This could present opportunities further down the track, as some property debutantes discover that not every letter box has a silver lining. If some new developments were to be sold, they would be lucky to break even. Over the last few years we have repeatedly been asked by previous clients to advise their children, who were embarking on their first purchases, on the do’s and don’ts of property. Most were at school and university when we endured the ‘recession that we had to have’ and they have only seen property prices on the rise. Many of the nouveau riche suburbs that have experienced huge capital gains with new developments, will in all probability be re-named ‘struggle street’ as they attempt to survive the current overtures of doom and gloom, not to be confused with the agent’s sales pitch of zoom and boom.

Once again we turn the spotlight back to the Mosman market, home of the Mosman $dollar$ that continually proves to be the most expensive in Australian housing currency. Real Estate Institute figures just released, clearly show that Mosman sales during the June quarter made up just 0.6 per cent of all sales in Sydney over this time. June quarter figures revealed that Mosman posted just 559 sales in the category of the top five local government areas with the highest median house prices. The common denominator is that of the 559 sales, every one posted substantial capital growth. This week we listed a semi on Ourimbah Road. It was sold within 48 hours for $760,000, yes Marize again!! Interestingly enough, we sold an identical semi to this exactly twelve months ago, only a few houses down for $622,000. That is a capital growth of $138,000 in twelve months. The September quarter figures will be very interesting.

What we have today is a much greater focus on the property industry. The statistics, facts and figures are now readily available for all to draw their respective conclusions on the state of the market. I was looking at a home this week, and yes the owner is a subscriber. He suggested that he spoke to another agent who basically echoed what I had written in the previous week’s edition of VRN. I see this as a positive because at least they now know what they are talking about, and it is better that agents talk about our market on a united and informed front. As for the most popular quote in the media at the moment “Economists predict the property bubble to burst”, Mosman has plenty of economists who all own homes, and to the best of my knowledge we don’t have any waiting to purchase, so you can work out where their money is!!

It really is no wonder why so many property stories are doing the rounds at the moment. You see, for the majority it is all good news, and we know that good news travels fast. Just as fast as your edition of Virtual Realty News. When and if the market has a significant adjustment, it will in all probability be here where you read it first, although I am sure that the Property Editor at The Sydney Morning Herald will have a few words to say to me about that one.

Thirsty work this… cheers and clink… ^__^

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