Ninja In A Blazer - August 2024

Spring is almost here and traditionally it is the peak time for real estate activity, however over the past 12 months the market that we have been experiencing is anything but “normal”. What do we expect for the rest of the year?  

Is the market peaking?

For those of you that follow the market or our monthly update you might have seen the pattern that the market for the past 12 months has continued to rise month after month with no sign of slowing down. The questions we often get from potential buyers or sellers is “how are people able to afford to purchase?” as homes are moving out of reach of many potential buyers' budgets. 

In the past month, we have begun to see some signs of reduced activity and slightly less fear of missing out (FOMO) from tracking our enquiry levels, open home numbers, as well as numbers of offers on each property. We don’t believe this is the market is cooling with the final prices still at the very peak of the market. You might ask what is happening? 

We believe due to the rapid increase of house prices it is starting to reach a point where buyers simply do not have the budget / ability to borrow past a certain point which is why the higher the houses prices are possibly seeing a greater reduction in activity, therefore we believe this is a budget issue and NOT buyers losing confident in the market. 

Will the market continue to rise?

Based on what we are seeing we believe that we will experience different levels of buyer activity based on area and price point of home, for example for properties that are relatively close to the city (for example 12-15km) units and townhouses prices and activity levels will continue to rise due to being more affordable. For buyers that are wanting to buy houses with land we are seeing buyers going out as far as Morayfield to secure something within their budget, this is why we have seen over a 100% increase in Morayfield prices for example for many homes from 2019 vs today. 

What will we expect of the property market this Spring?

Traditionally each Spring we see more properties coming to market, which often means buyers will have more choice and more opportunity to secure a home, however this also could mean a slight reduction in offers and FOMO from buyers that could lead to slightly less competitive offers. Our advice is if you’re ready to sell, don’t wait for spring, you should consider going to market as soon as possible, as the difference could result in a price difference of 2-3% which is a significantly amount of money. 

I also wanted to mention that homes that are maintained and display the best which is showcase by their photos are getting significantly higher activity and inspections compared to homes that are not well maintained or presented, therefore our advice to all our sellers is to take a bit of extra time to do anything you can to fix any known maintenance issues and to present your property in the best light. 

Residential Investment and Rental Update 

We are observing a shift in Brisbane's rental market influenced by tenants' affordability constraints. Rising interest rates and increasing living costs are prompting landlords to raise rents accordingly to maintain their investment viability. This poses challenges for tenants facing rental hikes and other living expenses. Properties priced under $650 per week remain highly attractive, with an average market time of just 7 days, reflecting strong demand. Higher-priced properties, while still moving, stay on the market for about 14 days on average, highlighting many tenants' sensitivity to price. Our team has had a strong month with 24 properties successfully leased whilst reducing the average days on market.

Commercial Property Update 

The commercial property market is still seeing strong levels of enquiry from both owner occupiers and investors. As the cost of money has increased investors are seeking higher yields of 6% or greater if possible. Owner occupiers are driving the industrial property market’s continued strong performance. Asset classes such as medical, commercial office and retail are continuing to build on a strong first half of the year. If you have a commercial property or looking to buy or investment in commercial or simply to get a better understanding, please contact our commercial team by visiting our website www.naiharcourtspinnacle.com.au

As always, we are here to assist in any possible and aim to be your first point of contact with anything relating to property, please feel free to call or email anytime if there is anything we can assist with, have a great rest of the month.