There seems to be some confusion out there about how the market is going. Property values are watched and analysed so carefully now that even the slightest movement up or down can result in a headline.
As always, I encourage you to think long term with property investment. If you keep putting off your next purchase because you’ve ‘heard the market is going to turn’, you’ll never end up buying.
Of course, you do need to be careful when you’re buying in a boom, but we’re not in a boom right now in our major capital cities. The city markets are pretty normal. They’ve recovered their GFC losses and we continue to see the green shoots of new long-term growth.
In Sydney, there’s been some sluggish buyer activity in some areas given a surge of new stock has come onto the market and buyers now have a bit more choice. Soon enough, winter will come and stock will likely drop back a bit and supply and demand will once again tighten. We’ll then see reports of strong buyer competition on the fewer homes available for sale. These are small movements that shouldn’t dictate your decisions regarding long-term investment and wealth creation.
This week we take a look at the state of play in all major capitals. These are December quarter numbers released by independent researchers RP Data.
Overall, property values nationwide improved by 4.7 per cent in 2010 and by as much as 8.3 per cent in Melbourne. The worst performer was Perth with a 2.3 per cent drop, which is nothing to worry about given the meteoric rise in property prices over the past few years thanks to the mining boom.
It’s important to remember that Australia is made up of many different markets. We use national figures to get an idea of what’s happening but you need to consider what’s happening locally when you’re looking to buy or sell. In Sydney, we might see one market doing well and another across the Harbour not doing well at the same time. Citywide, there are vast inconsistencies, so keep your research local.
The stats below will give you an indication of your city’s performance in 2010 and in my view they paint a very positive picture. I believe we’re in for some solid growth this year across all markets due to very strong underlying factors such as a national property shortage, rising rents and an excellent economy.
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