With only 59 days to go, I can't believe we’re on the countdown to Christmas already. Can you?
I also can’t believe it’s been months since I have last put together my last Gold Coast Property Market Update. I'm not slack, just busy - but it just goes to show how quickly time slips away when you dont have a focused plan in place - In life and in business….
Ive had a heap of past clients and network contacts call and ask of late “So Nicole, Whats REALLY happening in the Gold Coast Property Market?”
In their ‘Bricks and Slaughter’ piece back in September, we’ve had 60 minutes report a 40-45% price drop anticipated in the property market - which has put the fear of god into alot of people and understandably so. Louis Christoper of SQM Research has since come out and said that the piece was ‘distorted’ and he is disappointed in the way his interview was used with 60 minutes using only minute of footage plucked from his 40 minute interview which only detailed the worst cast and ‘most unlikely’ scenario of 4 scenarios given - see https://www.news.com.au/finance/real-estate/sydney-nsw/sqm-researchs-louis-christopher-disappointed-with-60-minutes-appearance/news-story/3a749833c55f9456cb71560252d7f764
Being a bit of a conspiracy theorist myself - I have my own thoughts on why this report was done, and the timing of it (think change of prime minister at the same time….) - details of which I wont go into here as I will be hunted down and shot at dawn - but happy to have a conversation by phone about it. I believe we are all pawns in the whole game and shows how easily the mass population can be moved and swayed by the ‘big players’ as need be….’Sheeple’.
What 60 minutes ‘forgot’ to report is that there are markets within markets - and its unintelligent to treat them as one and the same. They just aren’t. There’s so many factors that all play a part in the big picture - employment rates, demand, infrastructure expenditure, population demographics and movements just to name a few….
While Im not an expert in the Sydney and Melbourne property market - I do know that it is ludicrous to expect any market to continually go up without some corrections and adjustments along the way. While not property related, can I suggest you check out the fluctions in the Australian Share Price Index which is common place to fluctuate 5% IN ONE DAY. Just google 'XJO' and check the daily chart.
While I dont know and cant make comment on the Sydney and Melbourne markets, I do know that there is still plenty of property buyers around on the Gold Coast, lots of people renovating and trading up, and still lots of activity - which I dont see easing in the immediate future.
We are seeing a definite move from Aussie Expats coming back to Australia after living abroad for many years. Many large companies are looking for ways to cut costs and increase efficiency and ‘Remote Work Agreements’ (setting their staff up in their own home based offices) are becoming more common place - all made possible by technology like Skype, and cloud based computing with employees all being able to login remotely to the company server from anywhere in the world.
With most expats being paid in US Dollars, the currency exchange rates are working in their favour. Aussie Expats are coming back to Australia and buying our property at approximately a 30% discount. Something we’ll see happening for a while yet I think.. And why wouldn't they want to come home? The Gold Coast has it all - its relatively safe, a great lifestyle, good public hospitals, good public schooling, medicare, great weather and awesome beaches….
While the Banking Royal Commission has given the property industry a bit of a shake up - I think its a good thing. I believe the property industry will come out of the other side better and stronger for it (there's nothing like a good dose of metamusical to clean out the system….). We will have a strong sturdy foundation on which to move forward. There has been alot of ‘unconscionable conduct’ by our banking sector thats all coming to light now - but our banks have had a free run for a long time, some of it dates back to the 1980’s, so its all finally catching up to them. How an industry can make something like $31 billion profit just last year alone, from a population of only 25 million (that's close to $1300 profit per person for every man, woman, child and infant) is just insane. Clearly someone is getting ripped off some where…... so its good some tough questions are finally being asked! If you haven’t already seen it, I suggest watching the movie ‘The Big Short’ - it will give you some context into the banking industry and what lead to the GFC.
BUYER TIP - If you’re in the market to buy - use this tumultuous time to your advantage. Being a cash buyer currently can see you end up snavelling a bargain. If not, then we suggest you get your formal finance pre-approval in place and use this in your negotiations - you’re already a step ahead of 90% of the rest of the market and it puts you in a really strong negotiation point currently.
As an example, I just recently purchased a quite unique and sort after property for a client - 2 bedroom, 2 bathroom, 2 car parking unit with an almost 360 degree wrap around balcony in a boutique building in really good quality suburb with skyline views. I secured it the 2nd day it hit the market, and was able to negotiate some $35,000 off the price and had all the furniture included in the deal. All possible because the buyers were cash buyers (and maybe some good negotiation skills thrown in there too lol….) but so much so that at the open home on the following weekend, the agent had back up buyers ready to go for more money, excluding the furniture….
BUYER TIP - Be decisive and have your money in order - then you as the buyer have the power!!
BUYER TIP - I also suggest also using this tumultuous time to your advantage further and make a review of all your home and investment loans and renegotiate better interest rates with your bank. There are some great rates coming through now as banks try to regain some market share so if your bank won't negotiate don't be afraid to look elsewhere. The days are long gone where you stay with the same bank for 20 or 30 years. They often offer better deals to new customers than they do to their existing - which doesn't make great business sense to me, but that's the reality. While we dont have a mortgage broker in house, I do have some great ones I work closely with (who aren't afraid of creating a few waves with the bank) - message me if you would like their contact details.
In the Gold Coast Property Market, we’re still seeing lots of Sydney and Melbourne buyers coming through. They are cashing out of their properties down there - coming up here, purchasing homes in locations they’ve only dreamt about and sticking the left over cash in their pockets.
As an example - the median house prices for a 4 bedroom house in Coogee and Bondi in Sydney sit between the $2.9mil and $3.1mil mark - while our Burleigh Waters, Broadbeach Waters and Palm Beach median prices sit between $800,000 and $1.1mil (per realestate.com) so while we will never be a ‘Bondi’ or ‘Coogee’ our market has still got a long way to go by comparison, same proximity to the beach and we have a way better lifestyle and weather!
Theres so much thats happended on the Gold Coast since my last market update - the light rail extension to Burleigh is now approved and in process, and with its popularity, there is now rumours of it being expedited down to the Gold Coast airport asap. There’s talks of a possible ferry service for the Gold Coast - connecting the North and South ends by water with a number of stops in between. The Commonwealth Games have been and gone and were pretty much a non event. Rental vacancy rates have dropped to below 1% so that's great news for investors.
BUYER TIP - AND a word of warning - from what Im seeing in the market at the moment, I would definitely be avoiding buying any new or off the plan units and ‘investor specials’ house and land or ‘dual key’ packages at the moment. This isnt a product type I particularly like and think these are fraught with danger currently!! Happy to have a chat by phone about it.
Its my birthday tomorrow and on the eve of my 43rd birthday, I cant believe Im ‘that old’!
Jeez - It seems like only yesterday I was trying to work out what to wear and come up with a way to ‘sweet talk’ the bouncer so I could sneak into my local nightclub back home under age using my friends ID that I looked nothing like …..(hope you’re not reading this Mum!!) Admit it, Im sure Im not the only one.....??!
But It just confirms for me how fast time passes and how quickly the years slip away - especially if you have no plan in place. So as another year comes to an end and we head towards the crazyness of Christmass, its time to start thinking about what 2019 has in store for you? Is it time to set some new goals and set some plans in motion.
If you have any questions regarding Gold Coast real estate, then please make a time to have an obligation free chat with me. With my broadreaching network of contacts and other specialists Ive bult up over the 12 years Ive been doing this, I believe theres no real estate question I cant answer or find the answer to.
Until next month
PS - Im just putting the finishing touces on my report - Five Crazy mistakes ‘out of towners’ make when buying Gold Coast property! - and how you can avoid them. If you would like a copy, please shoot me an email