Tuesday 27 Jun 2017
Have you noticed anything in terms of the end of financial year and the residential real estate market? Me either. It’s interesting isn’t it? It is a major date on the financial calendar and it really has little impact on the market.
When you think about the market it does move with a gentle rhythm. We analyse every move as if it is the start of some major event when often what we are seeing are the regular ebbs and flows of demand, driven by the seasons and the annual holidays rather than anything more dramatic.
We see activity dull around Christmas and January with an annual bounce in Autumn and Spring after easing slightly in Winter. No real surprises there. Inspections and calls also drop off in school holidays. Serious buyers will always make time to call but those merely considering will understandably prioritise the family holiday.
But the end of the financial year brings not even a subtle shift. We talk of numbers and returns and investments with our accountants but there is no movement in the market. Saturation talk of EOFY sales may fill the media but not for residential property. And that works for me.
There has been significant discussion about new developments coming to market having an impact on existing apartment stock. Of course there is a chance more supply may influence prices but don’t expect an EOFY sale to clear old models.
There simply isn’t the need. Even with new developments selling rapidly off-plan we are still seeing great value for existing apartments, especially in the CBD and Pyrmont. Buyers recognise that new might be nice, but it doesn’t mean the older are unwanted and demand is still strong.
I think it demonstrates the inherent value of property. At that time of year, when we focus on our finances, it is worth realising that property is a very solid investment.