Over the last 12 months, it has been somewhat difficult to judge or predict the real estate market. However, as we approached the end of 2020 we started to see an increase in buyer activity that was predicted to continue into 2021.
We are only 3 weeks into January and 2021 is already shaping up to be an extremely good year for the real estate market. This is due to a couple of factors. With record low interest rates and continued government stimulus, more people have the money to buy a property. With things like overseas and interstate travel off the cards, more and more people are choosing to settle and buy or even to invest in property.
So with all of this how is the market performing? According to recent data obtained by Realestate.com.au, in the last week, buyer search volumes have continued to rise and are sitting at record levels. Compared to this time last year, buyer search volume is up 45.8%. With the activity increasing month to month, it is evident that the 2021 market will be extremely buyer dominant.
This is great news for sellers! With a large number of buyers on the hunt for the perfect property, this could mean an increase in property prices and a decrease in the number of days a property remains on the market. If you are thinking of selling this year, sit down with your agent to ensure your property is priced accordingly to suit the market to result in a quick and fair sale.
Statistics in buyer activity and houses on market also suggest that there could be an increase in property sale price, which is only expected to grow. Queensland alone is representing a massive quarterly increase, specifically in the regional areas. When it comes to where homebuyers are searching the most, suburban areas claim the top national spots in an analysis of realestate.com.au data. The data shows the geographical areas that have experienced the largest increases in demand as measured by high-intent buyer activity.
However, despite all this positive market feedback, we are only halfway through January. According to Realestate.com.au here are some further predictions for the market in 2021.
Demand to continue throughout 2021
Household saving has reached levels not seen since the mid-1970s, with many Australians unable to spend money the way they normally would. Borrowing costs are lower and governments are pumping money into the economy. All of which are encouraging Australians to consider buying property.
Rental markets may be challenged
Inner-city apartment rental markets are extremely reliant on people migrating to a new city, whether that be overseas arrivals for study or work or people arriving from interstate. In 2020, the drivers of such migration have been broken due to the pandemic.
In 2021, inner-city apartment markets are likely to continue to face reduced demand while Australia’s international borders remain closed. Renters are likely to be looking for better or cheaper accommodation when their leases expire and there will be significant competition amongst landlords to secure tenants.
First home buyer activity to fade, investor market to return
Demand from first-home buyers in 2020 has been buoyed by fewer investors, historic low borrowing costs, and government incentives.
As a result, the value of lending to first-home buyers reached a historic high. At the same time, the value of lending to investors has been lower than lending to first-home buyers over recent months, however, this has started to lift recently.
Low overseas migration will have repercussions for new housing
Demographics have been a driver of demand for housing over recent years. While birth rates have been falling, Australia has continued to see a comparatively high rate of overseas migration.
With the international borders shut throughout this year and seemingly well into 2021, this will create challenges for the new housing sector.
So if you have been contemplating selling this year it may just be time to pull the trigger. At iThink Property, we offer several marketing solutions to get your property sold effectively. Give us a call on 3202 3040 to discuss a tailored plan for you and your property.