The past month has delivered a mixed bag of results across our core area as we move into the final month or so of active selling for 2018.
Quality ‘A-grade’ homes, particularly in the higher price ranges, continued to attract strong interest and results that show that prices for these properties have held their 2017 levels. Across the board, however, there is clear evidence that prices have dropped and are now back to levels last seen around 2015–6.
The media is reporting the sharpest fall in Sydney house prices for 30 years and predictions of more to come over the short-to-medium term. The daily media cycle has deeply impacted buyer motivation and confidence and this ‘psychological’ impact on the market is almost as great as that of bank lending practices.
Lending practices in focus
Speaking of which, lately we’ve been hearing from buyers that the loan amounts they can get approved have dropped some 30–40% in recent months. Similarly, loan approval times have slid; a process that 12 months ago would normally take around two weeks now takes a month or longer and involves many more checks and balances than buyers have been accustomed to.
Ultimately, I believe that more responsible lending can only be a good thing in the long term. The gung-ho lending and fearless borrowing that drove the market to 2017’s heights were not sustainable. What’s important now is that the changes being brought in don’t go too far in the other direction. Homeowners who bought in the last three years stand the very real risk of having negative equity in their properties, and those looking to re-sell (for whatever reason) may find themselves in a difficult position.
Value is out there
Yet despite the negative reporting around the market it’s a good time to buy. More stock is available, competition is restrained, and prices are easing. With most people buying and selling in the same market it’s a great time to upsize; for buyers entering the market it’s as good a time as we’ve seen for five years or more – provided funds can be accessed.
For sellers, it’s important to recognise that with clearance rates around 40% it’s critical to work with an experienced agent. We’re likely to see more sales negotiated by private treaty and achieving a result is no longer a foregone conclusion; you’ll want an agent with a strong buyer network and tough negotiation skills to help you minimise risk and achieve the best outcome.
Congratulations everyone! The Inner West has won the 2018 Keep Australia Beautiful NSW Overall Sustainable Cities and Recycled Organics awards. The Sustainable Cities award was won thanks to projects from the Inner West Council and the Addison Road Community Centre, and both organisations were also Highly Commended for other projects.
Locally, this time of year is our busiest in terms of community involvement. We are major sponsors of many local events and sporting clubs across our core area; this month we’ll be supporting the Sailing Regatta, The Balmain Arts and Crafts show and many more local fairs and events.
Personally, I’m the community partner for the Nicholson Street Primary School and the Halloween Festival – our major annual fundraiser – was bigger and better than ever this year. Thousands of locals attend annually and for a small school it’s a phenomenal event. This year I contributed $15,000 through my commission-free sale donation; over past four years I’ve put in around $70,000 towards improvements in teaching resources, technology and playground improvements.