C21 Market Pulse | June 2023 | Australia

C21

MARKET PULSE

WELCOME TO THE June 2023

ISSUE OF C21 MARKeT PuLSe

P u BLISH e R

Century 21 Australia Pty Ltd

CO n TRIB u TORS

Tim Lawless Chris Gray Openn

e DITORIAL en Q u IRI e S

Century 21 Australia (02) 8295 0600

ADV e RTISI n G en Q u IRI e S

Century 21 Australia (02) 8295 0600

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C OR e LOGIC HOM e VAL ue I n D e X S u RG e S WITH STRO n G e ST MO n THLY GROWTH SI n C e n OV e MB e R 2021

CoreLogic’s national Home Value Index (HVI) has recorded a third consecutive monthly rise, with the pace of growth accelerating sharply to 1.2% in May.

After finding a floor in February, home values increased 0.6% and 0.5% through March and April respectively.

Sydney continues to lead the recovery trend, posting a 1.8% lift in values over the month, recording the city’s highest monthly gain since September 2021. Since moving through a trough in January, home values have risen by 4.8%, or the equivalent of a $48,390 lift in the median dwelling value. Brisbane (1.4%) and Perth (1.3%) are the only other capitals to record a monthly gain of more than 1.0%, however, the rise in values was broad-based with the rate of growth accelerating across every capital city last month.

CoreLogic’s Research Director, Tim Lawless, noted the positive trend is

a symptom of persistently low levels of available housing supply running up against rising housing demand.

“Advertised listings trended lower through May with roughly 1,800 fewer capital city homes advertised for sale relative to the end of April. Inventory levels are -15.3% lower than they were at the same time last year and -24.4% below the previous five-year average for this time of year,” he said.

“With such a short supply of available housing stock, buyers are becoming more competitive and there’s an element of FOMO creeping into the market. Amid increased competition, auction clearance rates have trended higher, holding at 70% or above over the past three weeks. For private treaty sales, homes are selling faster and with less vendor discounting.”

The trend in regional housing values has also picked up, with the combined regionals index rising half a percent in April, following a 0.2% and 0.1% rise in March and April.

“Although regional home values are trending higher, the rate of gain

BY TIM LAWLESS, HEAD OF RESEARCH, CORELOGIC

hasn’t kept pace with the capitals. Over the past three months, growth in the combined capitals index was more than triple the pace of growth seen across the combined regionals at 2.8% and 0.8% respectively,”

Mr Lawless said.

“Although advertised housing supply remains tight across regional Australia, demand from net overseas migration is less substantial. ABS data points to around 15% of Australia’s net overseas migration being centered in the regions each year. Additionally, a slowdown in internal migration rates across the regions has helped to ease the demand side pressures on housing.”

Premium housing markets in Sydney continue to lead the recovery trend. After recording a larger drop in values, Sydney’s upper quartile (the most expensive quarter) stands out with the highest rate of growth, gaining 5.6% over the past three months compared with a 2.6% rise in more affordable lower quartile values.

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I T’S n OT ALL ABO u T PRIC e

BY CHRIS GRAY, CEO, YOUR EMPIRE

Any successful and experienced salesperson, from any industry, will tell you that when someone sells something, it’s not always about accepting the highest offer they are given. For those of you that are looking at buying a home or investment, this is true in property too.

The vendor of a property isn’t always 100% motivated by money and so it’s really important to talk to the real estate sales agent and find out as much as you can about the property and the vendor. You may well be able to secure a property for less than you thought, even if a competing buyer is willing to pay more.

30 or 40 years, it likely has some sentimental value. Many owners will be very sensitive about who is going to take over their home and what they are going to do with it. They’re much more likely to sell to a ‘nice’ family than they are a renovator or developer that’s likely to tear it down.

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Selling to a ‘nice’ person. Your home is your castle and if it’s been where someone’s family has grown up over the last

2

Length of settlement. Once you exchange on a property you typically have six weeks to come up with money and the vendor has six weeks to move

out of their property and into their next home. For those in financial stress or in desperate need of raising cash quickly, if you have the ability to settle within a week or two, this could make you the most unique buyer in the market. Conversely, if someone needs more time to sort out their belongings that they’ve horded for decades, offering them a 12 or 16 week extension could be just what they’re looking for.

3 Ability to remain in the property after sale.

Depending on the market that you are transacting in, it can be hard to know how long it could take for a vendor to find a new home. Many are cautious about buying, before they know what their home will actually sell for. Rather than offering a longer settlement, a buyer could always offer a vendor the ability to rent the property off them after settlement until they manage to secure their next property. This would save a vendor from having to move multiple times,

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which everyone knows can be emotionally taxing. 4

Not letting the neighbours know. Not all vendors want to let the neighbours or community know that they are selling, especially if they are going through financial stress or divorce. This is when selling a property before it comes on the market, often known as a silent sale, can be very advantageous. Speaking to a sales agent about what future properties are coming up for sale and if the vendor would be open to taking an offer prior to listing. It can be harder to negotiate a much lower price in this situation, but at least you get to buy the property you really want and at a fair price, rather than having competition push it higher.

5 Saving money on marketing and auctions. Taking a property to market, running an advertising campaign and going to auction can be an expensive process and another reason why some vendors may be open to taking an offer prior to listing. Also, if a property doesn’t sell at auction it becomes ‘stale’ and the price could drop further –another reason why accepting a fair offer before listing could be just what the vendor is looking for.

Many of these motivations above may be completely illogical especially when you put your accountant's or banker's hat on, but so much of the property market is based on emotion rather than facts or figures.

If you’re keen to buy a better property for a better price, then working hand

in hand with a sales or a buyer’s agent can be the key to achieving that goal and asking more questions could save you literally tens of thousands of dollars.

ABOUT THE CONTRIBUTOR

Chris Gray is CEO of Your Empire, a buyers’ agency that buys homes and investments for time-poor professionals – searching, negotiating, renovating and managing property on their behalf. Chris has spent over 10 years as the host of ‘Your Property Empire’ on Sky News Business channel, where he’s interviewed various heads of property research companies and major industry figures. Chris is a qualified accountant, buyers’ agent and mortgage broker. For more information, visit www.yourempire.com.au and follow Chris on Facebook: @ChrisGraySydney

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BUY AND SELL PROPERTY WITH CONFIDENCE

With Openn you always stay informed, can see how many buyers are interested and you’ll never miss out on making or receiving that winning offer.

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O n LI ne A u CTIO n S VS TRADITIO n AL A u CTIO n S: WHAT’S TH e DIFF e R en C e ?

BY OPENN

Imagine knowing exactly how many buyers will submit bids on your property weeks before the set sale date. Or receiving an attractive offer prior to auction day and being able to give other buyers a fair opportunity to openly compete with that offer.

It’s possible when selling via an online auction platform like Openn. Bids and offers can be submitted from as early as day one of the campaign, giving real-time feedback on how the property is tracking, so you can sell with more confidence.

By removing physical limitations, such as time and distance, and introducing more transparency into the sales process, online auctions are an effective and popular alternative to traditional sales methods.

HOW DOES AN ONLINE AUCTION COMPARE TO A ‘NORMAL’ AUCTION?

An online auction and a traditional auction both involve the sale of a property through a transparent and competitive bidding process. However, there are several key differences:

• Location: A traditional auction is held in a physical location, usually on-site at the property, while an online auction is held entirely online, with bidders participating remotely.

• Convenience: Online auctions can be accessed from anywhere,

at any time, making it easier for buyers to participate. Traditional auctions typically require buyers to be physically present at the auction location.

• Reach: Online auctions can attract a larger pool of potential buyers, as they are not limited by geographic location. While phone bidders can be accommodated in a traditional auction, usually it is limited to buyers who can attend on the day.

• Cost: The fees associated with either selling method can vary. An Auctioneer is required in a traditional auction and most online auctions, which incurs a cost. However, online auctions can be less demanding on an

Auctioneer’s time and resources as they can run the sale remotely, meaning they can offer lower fees.

• Bidders: While traditional auctions typically only allow unconditional bidders, some online auctions allow buyers with conditions to participate (subject to the seller’s approval).

• Timeframe: An online auction allows the bidding process to take place over a fixed time-frame, with buyers able to bid from as early as day one. Whereas in a traditional auction, all the bidding takes place on the agreed day and can take anywhere from a few minutes to a few hours to finalise.

While traditional auctions are a highly effective process for selling property, online auctions offer many benefits such as greater reach, convenience, and flexibility, making it an attractive option for sellers.

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TOP DIY MISTAK e S TO AVOID WH en PR e PARI n G YO u R HOM e FOR SAL e

DIY projects are popular among homeowners looking to add value to their homes without breaking the bank. However, it's crucial to steer clear of common mistakes that could reduce your home's appeal to potential buyers when it's time to sell. Here are the top DIY mistakes to avoid.

NOT KNOWING WHEN TO CALL A PROFESSIONAL

One of the biggest mistakes homeowners make is skipping professional consultation. While DIY projects can be fun and rewarding, it's important to know when to seek professional help. Overestimating your skills can result in mistakes and even safety hazards. For example, if you're not sure about the structural integrity of a wall, consulting a professional

is the safest and most efficient option. Skipping this step can lead to costly mistakes and potentially lower your home's value.

OVERPERSONALISING YOUR HOME

While you may love bold colors or unique decor, potential buyers may not share the same taste. Overpersonalising your home can make it difficult for buyers to envision themselves living in the space. It's important to keep your

decor neutral and appealing to a wide range of buyers to maximise your home's appeal.

IGNORING CURB APPEAL

Curb appeal is the first impression potential buyers have of your home, so it's important to make a good one. This includes everything from maintaining your landscaping to painting your front door. Ignoring curb appeal can turn off potential buyers before they even step inside.

NOT COMPLETING PROJECTS

Starting a DIY project and not completing it can have a negative impact on your home's value. Potential buyers may view it as a sign of neglect or even assume that there are other unfinished projects in the home. It's important to finish all projects before putting your home on the market.

CUTTING CORNERS

Cutting corners may save you time and money in the short term, but it

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can have negative consequences in the long term. This can include using cheap materials or skipping steps in the project. By cutting corners, you risk having to redo the entire project or even causing damage to your home.

FAILING TO CONSIDER ROI

Before starting a DIY project, it's important to consider the return

on investment (ROI). Some projects may add value to your home and increase its appeal to potential buyers, while others may not be worth the time and money. It's important to consult with a real estate agent or home appraiser to determine which projects will have the biggest impact on your home's value.

NOT TESTING BEFORE YOU START

Before starting any DIY project, it's important to test the materials

and tools you'll be using. This can include testing paint colors on a small area or testing a power tool on a scrap piece of wood. By testing beforehand, you can ensure that everything works properly and avoid costly mistakes.

By avoiding these common DIY mistakes, you can maximize your home's appeal to potential buyers and increase its value.

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