Interstate Investors Return To Melbourne
In This Week’s How's The Market | Edition 105
Interstate Investors Return To Melbourne
7.3 Meter High Front Door That Swivels In Kew
Yesterdays ABS Inflation Data Drops Again Before RBA Meeting Next Week
Interstate Investors Return To Melbourne
Melbourne was the fastest growing capital city in Australia in February growing by 0.7% for the month according to PropTrack.
On the ground, this is something we are definitely feeling, though not in every market.
We are still seeing the apartment market, low quality new build market and townhouses with little land struggling.
Whilst the established house market with 500+ m2 of land is going crazy.
The biggest difference we are seeing between the markets that are performing well vs still struggling is the introduction of interstate investors.
I made an offer against an interstate investors last week that made an offer sight unseen way above the top end of the range on a property that had comparative sales $50k less than their offer 2 months ago.
This was an unconditional offer with no finance or building and pest clause too.
As I speak with more and more agents, this seems to becoming more common - predominantly with properties under $750k.
I do believe this will also affect the rest of the market in Melbourne.
As these properties achieve great results, it makes the surrounding properties look like better value.
Top End Inner Melbourne Auction Results - 22nd Mar
Auction Clearance Rate = 42.9%
A few strong sales, but also some properties that didn’t move.
The market has the potential to take off, but pricing and marketing need to be spot on, as buyers remain price-sensitive.
What The Agents Are Saying
Underquoting is becoming more common as the market rises.
This is not actually agents being malicious (most the time).
It becomes harder to price properties as the market increases.
Agents use the data from recent sales in previous weeks and months (up to 6 months) to create the quoted ranges for their properties.
If the market is significantly better than what it was 3 months ago which is definitely what we are seeing, it makes it much easier to underquote a property if you’re using sales results from late last year.
These may be the most comparable properties for the target property which means the quotes could be slightly lower than actual value.
Agents have told me that this is the case a few times and most of the agents that have said this are still very surprised when properties sell competitively above the top end of the range.
The Wow Factor!
71 Cecil Street, Kew, Vic 3101
This property has a 7.3m high front door that swivels.
Can’t really beat that in terms of a wow factor as that is how you enter the home.
However, this build from Wall Architects looks pretty exceptional the whole way through.
The ceiling height, floor to ceiling windows that let in an insane amount of natural light and how the property flows through to the fully landscaped gardens are all top tier.
Price Guide: $8,100,000 - $8,900,000
In The Media
Inflation slows again less than a week from next interest rates decision
Big news for one week out from the RBAs next meeting.
Budget headlines that have also been released look to aim to bring down inflation as well.
However, the RBA rate indicator is predicting only an 8% likelihood of a rate cut at the April meeting next month.
Final Thoughts
Interstate investors are back!
This massive new increase in demand is driving up property prices in the more affordable markets, specifically on properties that have 500m2+ of land.
If you or someone you know would like assistance to buy this year, book in a call and we can discuss if we can help.
Thanks for reading this far!
We value feedback and if you have any suggestions on what you would like covered in the future please email me at tristan@tomii.com.au
Happy Buying!
Note: This is general advice and does not take into consideration your objectives, situations or needs. Please consider if this advice is suitable for you and your circumstances and speak to a professional before making any financial decisions.
