Suddenly it’s all tinsel and test cricket.
Another year, just like that, gone!
What a quirky and confusing year it’s been in real estate land.
Like a night out on Pattapong Road, the market has been full of metaphorical ladyboys providing confusing and conflicting messages. What does it mean? How should we feel?
One minute the mainstream media says the world is ending – with the Eastern states driven real estate storyline attempting to encompass Perth, with its catastrophizing and doomsday predicting. And yet I’m seeing double digit growth in some western and inner city Perth suburbs. Domain group today posted their expectation that Perth house values are likely to grow by 5% in 2019.
On the ground the talk is batteries – Nickel, Lithium, Cobalt and Graphite. Gold is having a renaissance. Oil, gas and iron ore are all rumbling to life with new projects across the state.
To continue this confusing conversation home loan lending is being constricted with the big four making it harder for applications to be approved.
In a state with better economic conditions than it has enjoyed for years, new mines being built, higher commodity prices, improved employment prospects and population growth, it seems that we are the target of a big bank reaction to the banking royal commission, with money substantially harder to borrow. Surely, as the change in WA’s economy becomes obvious and the housing lead malaise in Sydney and Melbourne sets in, the banks will relax their national lending restrictions and look at markets like Perth as being a good risk? I’m naive, but I can’t see how a broad blanket approach from the banks is in their best business interests?
Although the bottom of the market may be past there is loads of opportunity for those that are in a position to buy. Apartments continue their unexciting road to recovery. It is still possible to buy apartments for less than real world replacement cost.
Opportunity also abounds in the outer suburbs of Perth, where exists a real estate purgatory with recovery somewhere over the horizon. A surplus of supply and a broken system incentivised by state government handouts, fuels the new home market. Second hand is second best for new home buyers. Trapping highly leveraged sellers underwater on loan to value ratios, making an exit from the property market almost impossible.
With increasing sales volumes and buyer confidence, Perth is on the other side of a particularly awful economic and housing market hangover. But like that one Uncle on boxing day morning, it’s going to take more than a soluble Disprin and a lie down to be bright eyed and bushy tailed again. Regardless, the market is showing more than green shoots and the good news far outweighs the bad.
We at Baston & Co. Property, would like to wish you and yours the best of Christmas’ and a safe holiday season. I can’t wait to get back next year to an exciting marketplace filled with positivity and people fulfilling their home ownership dreams.