Since the beginning of the Covid-19 pandemic there has been an 20% increase in the number of homes sold each year, the problem is we have been selling more homes than we have been listing for sale. This is not unique to the realestate industry, during the peak of the Covid pandemic supermarkets were selling groceries faster than stock was coming in and as a result we experienced empty shelves, builders have had trouble sourcing materials, and so on.
The question is how long before we see a more balanced property market where supply meets demand? Given the shortage of residential land and relatively high cost of building, the low supply of existing residential homes is not likely to change in the foreseeable future. What has changed has been the rising cost of finance, and although supply levels are the their lowest levels in well over a decade, there seems to have been a change in the buyers motivation, they have moved from a “fear of missing out” to a “fear of paying too much”
Median price changes over an extended period are a good indicator of how the property market is performing, however use this as a guide, the best way to find out the value of your property is to ask a local agent to provide you with an assessment, its FREE!
Rental market update
As you will have heard, there are very few properties available for rent in the Riverland. The vacancy rate locally is less than 1.5%, and with more people moving into the area, we can’t see that improving in the short term. Fortunately we haven’t seen the outrageous rental price increases that have been reported on the media, most Riverland landlords have reasonable expectations and pass on modest increases, they just want tenants to look after their homes and pay their rent on time, and the majority of tenants do the right thing and landlords appreciate that. Investors generally make up 20% of the buyer pool, investors are much more sensitive to interest rate fluctuations than owner occupiers. 2 years ago an investor could secure finance for 3-4%, today its more like 7%. We may see a reduction of new investors buying rental properties at atleast till interest rates stabilise or start to fall.