Southern Gold #1
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Welcome to "Southern Gold"! Our boutique agency newsletter full of quality content and delivered regularly! I will endeavor to highlight local issues effecting the Southern GC and real estate in general. I am sure you will find something interesting in our newsletter when they hit your inbox!
Recently there has been a lot said about the large amount of unit developments at Palm Beach. A lot of people don't like it and others claim this style of development avoids the urban sprawl. I am going to avoid that debate about the pros and cons of urban development. However I will offer my thoughts about how an influx of units may effect the unit market in this suburb moving forward. The use of statistics is particularly interesting when looking at this sector of the market. The two topics are directly related to each other with the use of the statistics easily utilized to influence opinions?
So is it a Strong market or weak market? You can find articles that support both opinions. The pessimists stating the Australian real estate market is about to collapse, and the optimistic among us stating that now is a good time to buy because interest rates are low blah blah blah…..The truth is a lot of these articles are a clever use of statistics written by those wanting to influence their readers for their own cause. Real estate agents blabbing on about how strong it is and how good they are! Or financial advisers saying get out of real estate and into shares. Whatever your cause, you can usually find a statistic to suit your need. Quotes such as ‘a portion of the local market is up 12%’. May I ask What portion and compared to what? I’m not suggesting statistics are bad, in fact they are very important and useful tool to assess market conditions, its just the use of the stats and by whom that you should be mindful of.
A classic example happening right now is the unit market at Palm Beach. Palmy has been one of the strongest performing Gold Coast Suburbs for a few years now. Last year July 1 2018 – June 30 2019 there was approx. 250 unit sales recorded across the suburb. Currently there are approx. 600 units either in planning, under construction with most available for sale off the plan. That is more than the total volume of sales for the last year and that doesn't consider existing unit sales.
I am not a valuer or qualified statistical analyst, however my 16 years’ experience selling locally gives me the gut feeling that perhaps opportunities will arise with this sector of the market? Who for and when? Well that’s the variable of real estate - you can be successful in any part of the real estate cycle, just as you can in the stock market! What does Warren Buffet say ‘buy in gloom sell in boom’ There will be a number of variables that effect the market but simple supply and demand will surely influence this sector of the market? Or will the attraction of these new developments bring enough new purchasers into the suburb?
If you think back to the mid 2000's off the plan unit sales at Broadbeach and Surfers were through the roof. All you had to do was sign up to buy one,pay your deposit and sit back for 12 months then re sell it for huge margins. Before construction was even finished in some instances. Then the Global Financial Crisis smashed it all! and some developers and punters got hurt big time! For some the price recovery took every bit of 10 years, but for those buying at the bottom well that's a different story again with nice profits to be made if you timed your purchase correctly!
I’m not negative on buying units in Palmy or anywhere particularly. But if you’re playing the market, be sure to satisfy yourself through adequate research of your purchase and be mindful how timing and changing market conditions can affect you! I can happily provide you with some suburb statistics from core logic to help you! Shoot me back an email and I can provide a core logic market report for all our local suburbs. I can also offer you more detailed info relevant to your needs. Im only to happy to help!
For the record i think local conditions are going along really nicely! I am experiencing good turnout at open homes and lots of buyer enquiry! The Spring Buying season is well under way! And yes the low interest rates are definitely helping with borrowing rates incredibly low! We live in a wonderful part of the world and it is easy to see why we are the envy of most parts of Australia and why population growth is so strong! But thats a whole new topic and one the statisticians can use to factor in the future development of our little patch of gold!
Please get in touch if i can help you with any real estate matters! Love to help you!