May Real Estate Insights: Resilience Amid Uncertainty
Real Estate Market Update with Leigh Martinuzzi MPG
Heron Todd White recently released their month in review, offering valuable insights into the current state of the property market. Despite the ongoing pressure of rising living costs and inflation hovering around 5%, the property market continues to demonstrate remarkable resilience.
Amidst talks of potential further rate rises by the RBA, fuelled by media speculation and hype, uncertainty prevails, influencing buyer behaviour across the country. The mere suggestion of rate increases prompts caution among prospective buyers, contributing to a climate of hesitancy rather than confidence.
A notable trend emerging in response to soaring detached dwelling prices is the shift towards units or attached dwellings, a pattern already observable in our capital cities. This trend is expected to extend to the Sunshine Coast, with coastal suburbs witnessing the release of smaller land plots and an influx of unit and townhouse complexes. As a result, larger properties near major attractions like Palmwoods are likely to experience strong long-term growth.
The debate between buying new versus established properties is ongoing, with established homes offering better value for money despite potentially dated features. The scarcity of land and soaring building costs further bolster the appeal of established properties, despite the allure of contemporary new builds. Recent sales, such as a residential home in Palmwoods fetching $1.37 million, highlight the premium attached to new constructions, with building costs averaging anywhere from $2,200 to $3,000 per square meter.
Interestingly, properties in need of repair or renovation are garnering attention for their affordability, particularly amidst the current climate of high building costs and lengthy construction timelines. However, fully renovated or new properties continue to command premium prices and shorter selling periods, indicating a persistent demand for turnkey solutions.
On a lighter note, let’s delve into a fun fact about Australia’s population density, courtesy of CoreLogic. With just 3.5 people per square kilometre, Australia boasts vast expanses of uninhabited land. However, half of the population resides in the three largest cities, with Melbourne topping the charts with a population density of 521 people per square kilometre. Despite these variations in density, rental price increases and property value growth appear largely unaffected, highlighting the diverse dynamics of the Australian property market. That’s a warp from me this week. If you need anything in real estate, please get in touch.
