April Director's Desk - Are we there yet?
Friday 15 Apr 2016
That dreaded question: Are we there yet? Usually closely followed by ‘How much longer?’. They’re both questions that echo across the countryside as families set forth on school holiday road trips, but at the moment they are equally common in real estate. So, are we? There yet?
It appears not, at least as far as vendors are concerned. In the CBD listings are at unprecedented low levels, down around 40% on the same time last year, and it is equally tight in the other markets in which Morton operates. Vendors seem intent on waiting.
As for ‘how much longer’ they will wait, hopefully not long!
And while it is frustrating to see the market performing well and yet buyers still nervous to list there is an upside. The low levels of stock are delivering very good prices.
You might assume buyers are holding off because of nerves about the state of the economy and the impact on the market. That’s what I thought initially but over the last couple of months it appears a different motivation is at play. In speaking to property owners our team of agents have found they are reluctant to sell because they’re nervous the lack of supply might make it difficult for them to find a replacement property.
So it is a little extraordinary to think that it is a lack of supply, as opposed to price, that is driving the lack of property supply.
The good news is that means the solution is in the hands of property owners themselves. More properties coming onto the market will drive more properties onto the market and it should also drive equal demand.
So in answer to the question. No. We are not there yet, but if potential vendors look at the road ahead they will hopefully realise they shouldn’t wait much longer to list and take advantage of the market demand that is out there.