As we head into 2012, there are still some dark clouds looming over Europe but slowly but surely things seem to be on the mend.
The interesting one at present is probably the United States which has finally got their unemployment rate down to 8.3% after being at over 9% for the last 3 years. We are seeing signs of recovery there, and as the green shoots start to appear and the US economy gets stronger we will eventually see our Australian dollar get down to a more realistic level.
Agents are reporting that there is a 20% drop in listings than this time last year, and that the number of buyers inspecting properties is up by a considerable amount since last year, with an average of 30 people through each inspection over the last 2 weeks. They are also reporting that their January sales have been on average the best in 2 years.
On my side the enquiry and clients signing up in January wanting to purchase a property has been I think probably my best January ever.
PK's Property Market Predictions for 2012
With interest rates at all time lows and banks being extremely competitive to win the business, I think you will see a lot of renters come out of the rental market into the property market to buy in 2012. The landlord has been king for a long time and my tip is that while interest rates are low and property prices are subdued, you will see a good influx of buyers in the $350,000 to $1million range start to enter the market in 2012.
As the lower end starts to recover and more people come out of the rental market and buy, that's when capital growth starts and rents ease. I think the upper end will still struggle this year but I do believe that up to $2 million on the Lower North Shore in houses there will be a revival which will slowly creep down to the Upper North Shore by Spring.
On the Northern Beaches up to North Curl Curl, I think you will find these areas will also start to pick up considerably due to low stock levels, and it will be great buying all year up to Palm Beach. The Eastern Suburbs up to $3 million in houses should be pretty strong, above that no change from last year unless the stock market really shows signs of taking off.
The Inner West will show continued signs of strength throughout the year and I do believe rental prices will stay strong.
Overall I don't think there has been a better time to upgrade or get off that rental treadmill, as it is always hard and dangerous to try and pick the bottom of the property cycle but under these present circumstances I do think we are there now.
PK's Hot Tip
PK Property was the first buyers agent to establish itself in Sydney back in 1997, that's 15 years this year. In the time I have had the business I would have to say that I am saving more money for clients at present than I ever have.
If you need a hand searching for a property, or someone to negotiate one that you have found, please don't hesitate to call one of our buyers agents today for some free advice on your purchase.
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