Rate hikes lower property sales
CONFIDENCE in the local property market remains strong, despite a lack of movement in prices and low turnover rates, agents have said.
The latest RP Data-Rismark Hedonic Home Value Index, released yesterday, reports regional property markets across Australia grew at less than half the rate of their capital city counterparts over the past 12 months.
That matches the experience of Ballina Professionals principal Peter Carmont and Wal Murray & Co First National Lismore agent Katrina Beohm, who both said local prices had flattened since the Reserve Bank started lifting interest rates.
However, both also reported strong investor interest in the local property market. Mr Carmont said investors currently accounted for about a quarter of sales in the Ballina market, while Ms Beohm said they accounted for about a third of sales around Lismore.
“This is a good time to buy,” Ms Beohm said.
Mr Carmont said the Ballina market was still seeing a reasonable turnover of properties at the lower – $250,000 to $500,000 – end of the market. However, properties were moving slowly at the upper – $800,000-plus end.
“Inquiries have dropped off dramatically over the last two months and the number of people at open houses has halved,” Mr Carmont said.
“The interest rate rises have done what they were supposed to do. They have taken the heat out of the property market.”
Mr Carmont said buyers appeared to be waiting for rates to stabilise before committing to a new mortgage. On that basis, he expected the market would pick up again towards Christmas as home buyers got a clearer idea of what sort of repayment commitments they would have on a loan.
Ms Beohm said the lower end of the market was still performing well around Lismore. The rural market was also performing well, with buyers happy to spend $800,000 to $1 million on afarm that would provide some income as well as a home.
The slow area around Lismore was in between the $600,000 to $700,000 band, which tended to include lifestyle properties not able to produce a substantial income.
However, interest in those properties remained, provided vendors were prepared to meet the market. Ms Beohm said she held high hopes for one of those – a ‘quality’ three-bedroom home on eight hectares at 933 Bruxner Highway, McKees Hill – after its owners yesterday dropped their asking price to $605,000.