Firstly,
Auction clearance rates across Sydney have risen 4 weeks in a row resting now at just over 60% which is a positive sign for sellers. A falling auction rate can be capitalised on by buyers driving negative sentiment through the market.
Domain data suggests that most properties are selling 6.7% below their original listed price, so while we are seeing positive clearance rates and stock is not sitting on the market as long as predicted, it is the sellers who are reacting quick who are securing the sales.
In a cooling market, there is often a correlation with the final sale result discount and the length of time the property sits on the market, save a few outliers. Reacting to the market quickly and selling when the property has the most activity often results in the best price.
While the broader Sydney market has recorded higher stock levels (reported below), the Upper North Shore is still crying for stock.
There has been a noticeable drop in prices, roughly 10-15% over the last 6 months, since February and these will be noted once the last 2/3 months of settlements take place. However, with low stock levels across the Upper North Shore and strong buyer numbers, we have seen a freeze in price drops. While I believe we are still 6-12 months away from any noticeable price increase, the supply v demand seems to be keeping us safe up here, in spite of further impending rate rises (next one to 2.35%) – watch this space.
Local market:
As mentioned above, we are seeing bursts of stock come to market in certain suburbs, but there is still no real consistency.
Further noted, the variety of agents listing in suburbs outside of their usual areas shows that we are seeing sellers using the agent they bought through to sell their existing home more often.
This could be the result of the selling agent on the purchase offering a drastically discounted commission to secure another sale as stock tightens and desperation sets in.
However, we have seen this impacting local prices, with agents working sometimes completely out of area for either themselves, or their agency.
The premium market in the Upper North Shore seems to be completely un-impacted to a certain extent, with new homes and premium land-sales still smashing records in a cooling market (see below).
Preparing for sale is one thing that has changed more and more as the year progresses; house-washing, garden work and landscaping, decluttering and painting is now often compulsory as buyers become increasingly pickier. While we have less competition on the market, buyers are becoming more frugal with their money as their budgets tighten with lending criteria restrictions, so minimising maintenance and basic work to your home will assist with your negotiations at the pointy end of the deal.
Ray White Upper North Shore:
** Awarder Number 1 Agency in the Ray White Network World wide **
Total listed for the month:
50
Average days on market:
Approx. 30
Highest sale price:
$9,010,000
11 Lord Street, Roseville – sold OFF MARKET to a buyer from our database
Wider market:
Sydney’s Auction clearance rate has begun to swing back up again, sitting at an average just over 60%. This marks 4 straight weeks of positive clearance rate growth.
New listings online in August rose 7.1% compared to the previous month.
Further, listings are 26.4% higher than this time last year.
As stock increases across the Sydney market, we will start to see the current buyer pool disappear as new buyers join the market, this will be what marks the trough in the Sydney market; New buyers, with lower borrowing capacity conditioned only by confidence in a ‘buyers’ market’.
It will be after this trough that we start to see positive growth again, with savvy buyers jumping back in at the right time, creating FOMO and pushing prices up again, but with a few more rate hikes, this may take a bit longer.
ANZ has now increased their peak to trough predications to an 18% drop and Westpac to 20%. Not that this really has any bearing on what actually happens as early COVID figures were the same and the market took off more than 30% in most areas.
Banks:
Adjusting their rates accordingly. We have seen long-term fixed interest rates going up factoring in the predicted rate rises, but not as high as forecasted months ago. This may be contributing to buyer confidence.
Interest Rates (RBA):
Currently still at 1.85% with an 83% expectation of another rate rise next Tuesday to 2.35% which would no doubt send shivers down the spines of most people watching the property market.
Conclusion:
The Spring market is traditionally a sign of stronger sentiment through the property world and we are seeing signs of people gearing up to embrace this, on the buying and selling side. However, we are seeing a little bit of hesitation as sellers struggle to find property to buy and buyers hold for more price drops.
What I would say, is, embrace the market, the same risks can occur in a rising market, it is just the stories sound better because prices are going up every day, but unless you are cashing out of the property market completely, you will be impacted on one end or the other.
Take advantage of the slower market we are in, there are currently no dramatic price shifts, up or down, and there is more stock reported on the portals, so trade with confidence that you will find a buyer and there is a property out there for you!
IF you would like a report on your suburb, please reply and I will send a copy straight over.
If you have any questions or would like a report on another area, please let me know.
Look after yourself and the people around you.
Thank you.
Thomas Merriman
Ray White Upper North Shore
0401 840 859
www.thomasmerriman.com
Thomas Merriman 