Stock Tight - Market Strong
Welcome to the 2016 property market and what an interesting year it will be. I thought I would wait a couple of weeks to monitor auction clearance rates and get a general feel of what the market is doing.
I have now done that and come to a conclusion once again that stock is now at emergency levels in all price ranges throughout the North shore, Inner west, Eastern suburbs, and Northern Beaches.
And when supply is low and demand is high prices will continue to rise. Agents have said that it's been tight for 4 years now and getting worse, and they believe this is just the new market, so get used to it everyone.
I don't know how it's going to pan out for agents over this year, as just the lower North shore has 200 real estate agents, and this week there is only 54 Homes listed for sale in Mosman.
Please note: The North West and Western suburbs of Sydney have plenty of stock, and these are the regions that are getting thrown into the mix to bring down the recent overall clearance rate reported in the Sydney morning Herald on a Sunday at 73%.
But when you have a look at the regions broken up below, you will see by the graph that the overall clearance rate is so much higher in a lot of individual areas.
Domain Recent Auction results in the Regions
Northern Beaches: 87.5%
Lower North Shore: 85.7%
City and East: 81.8%
South: 81.3%
Upper North Shore: 81%
Canterbury Bankstown: 75%
Inner West: 71.4%
South West: 66.7%
West: 64.3%
North West: 62.5%
Central Coast: 42.1%
It's so important as a buyer to look at these individual auction clearance rates because it allows you to gauge the sentiment for negotiation on certain properties, in certain areas.
If you are buying on the Northern Beaches you will have to be more aggressive with an auction clearance rate of 87 percent. But if you are buying out West when auction clearance rates are hovering around 64 percent, you can afford to drive a hard bargain. I will talk more on negative gearing issues and the ramifications for the property market when I hear more from both political parties.
PK's Property Market Predictions
I see a very strong property market for Sydney excluding North West and Western Suburbs, and certain parts of Southern Sydney.
I also am hearing from agents that these new underquoting laws are confusing buyers even more than the old rules. Please understand when an agent quotes the 10 percent rule that doesn't mean the vendor has agreed to sell the property in that price range. In most cases the owner wants way above that top price quoted.
If an agent quotes $1 to $1.1 Million who's to say that the property might only be worth $950,000 and you get accepted $1,050,000 thinking you got a good deal. Remember you just can't underquote, doesn't mean you can't over quote.
PK's Hot Tip
I just purchased last week 107 Artarmon Road, Artarmon for $2,545,000. This property was a silent sale, not advertised to the public market. If you want an advantage in this tight market and get introduced to silent sale properties, give one of our buyer's agents a call today.
Also don't forget PK's 2 min video tutorials on youtube showing you hot tips and negotiating tricks of the trade.