Everyone Walk in Real Slow!
As we enter into 2023, I noticed this meme popping up everywhere. Nobody claim 2023 as “your year”. We’re all going to walk in real slow. Be good. Be quiet. Be cautious and respectful. Don’t touch anything. It is as if you’d think we had a tough couple of years.
Looking back on the property market in 2022, we experienced quite a turbulent year. With prices sky rocketing affordability quickly deteriorated, while consumer sentiment suffered with many being priced out of the market as every week we saw new street and suburb records across the nation. We were then hit with successive interest rate rises that started back in May, and month after month, they kept rising. We all started to feel the squeeze at the bowser and in the grocery store, actually – everywhere we turned we were subject to surging inflation making it feel as though we were not in Kansas anymore.
CoreLogic data shows that Australian house prices experienced a decline in price of 8.4% in under nine months, between May of last year and January 2023. The highest falls were predictably seen in Australia’s three largest cities, where we saw the most dramatic price increases during the pandemic inflated market. Sydney saw a 13% decline, Melbourne 8.6% and Brisbane 10%, with an average $64,820 dropping of the value Australian homes. This decline is certainly not a blanket result with certain suburbs and property types still performing exceptionally well. This is your stock standard, levelling of the market after significant increases for a prolonged period. As mentioned interest rate rises, constrained borrowing capacity and lack of consumer confidence all contributing to the market conditions.
While we approach 2023 with a sense of caution and trepidation, it is timely to remind ourselves that the market is the market and there is nothing we can do to change it… Walking slow, being good, being quiet, cautious or respectful will not change the market conditions. As agents, we need to remember that anyone selling in this market, is likely buying in this market also, levelling out the impacts of the price adjustment as it remains relative. Over the coming months we can expect the housing market to remain soft, with the underlying cash rate expected to increase further as we push into the first quarter of 2023. Ongoing increases of course will impact borrowing capacity and until interest rates stabilise we can anticipate a soft market, or shall we say, a return to 2019 conditions.
The secret here folks is to maximise your sale price using a strategic auction campaign that extracts buyers from the market and pins them against each other in the auction arena to achieve the highest possible outcome in the current market. Auction generates unconditional contracts and furnishes sellers with real time data and market feedback so they can confidently make decisions around reserve price and ultimately the level at which the hammer drops.
If you have been avoiding the auction process, 2023 is the best time to get onboard this fast moving and well-versed real estate train. The Holmes Auction team are in an exceptional position to provide auction training and support that will not only educate you about the process, how to get the best results but also instil confidence in the process so you know you are providing your sellers with the best method of sale to generate the ultimate results.
If you would like to book a training session with any of the Holmes Auctions team, contact us today and let’s get this show on the road!
