Nationwide chat about plunging house prices and dismal auction rates is creating a sense of doom and gloom around the property market.
PropTrack’s July data showed Melbourne’s median house price slumped 0.5%, but most of the impact is being felt in the top end of the market. So if you’re a first home buyer or a mid-market buyer you’re not greatly affected. And if you’re upsizing, that 0.5% downturn is good news for you. Broadly speaking, a 0.5% drop on a $1M property means vendors may get $5,000 less than expected, but a 0.5% drop on a $1.5M property they might purchase equates to a $7,500 decrease. So in a sell-to-buy transaction that vendor/buyer could profit by $2,500.
The news isn’t all bad in regional Victoria either. While it is widely reported that median house prices in regional areas dropped 0.1% in July, they have still increased by 4.8% over the past 12 months, according to PropTrack.
And median unit prices outside of greater Melbourne actually rose 0.1% to $451,000 in July, an increase of 6.3% in the last 12 months.
As for the fearmongering around first home buyers who accessed the 5% deposit scheme being at risk of negative equity if prices continue to fall, that risk only comes to fruition if they sell while prices are low.
As real estate is long term investment for most people, there’s no need for doom and gloom.
Chat to us about how a property advocate can help you sell or buy in the current market with confidence. Investment buyers can receive invaluable support and guidance through our Buyers Advocacy Service, and for landlords who are selling, our Vendor Advocacy Service helps vendors achieve outstanding results.
To book a free 20-minute consultation, simply click here and choose a time convenient to you.
By Wendy Chamberlain
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