Market Update 20 FEB 2023 - Mandurah Real Estate
Mandurah Real Estate Update from the weekly Mandurah Real Estate email:
There’s currently 497 dwellings available to purchase in Mandurah, a bit of an uptick from last week.
Small and affordable homes under $300k still fly off the shelf, waterfront that’s reasonably priced doesn’t hang around long either.
I’m noticing a bit of stock coming onto the market with owners asking what seems to me unrealistic prices. I’m not sure if agents are just chasing listings and over-promising, or if the market is steadily marching north; will need to watch and see.
There seems a risk right now in over-pricing your property. If inflation doesn’t get under control in the next month or two in Australia, we’re in for a world of pain with interest rates. In that case I can see recent price increases in some segments quickly reversing or heading sideways. If your property is overpriced now you run the risk of not moving it at all in a few months if interest rates DO indeed keep moving north.
Couple that with the fact that there’s a non-zero chance a lot of your neighbours will be in mortgage hell in a few months when their fixed rate mortgage pivots to variable, there might be some forced sellers coming onto the market.
But with all that said, it’s still impossible to find a rental property. So selling your home to go find something that doesn’t exist, i.e. a reasonably priced rental, might be a dumb move anyway.
In the short term rental market I’m seeing lots of people booking low end properties for as long as they can just to have a roof over their heads, and holiday makers are paying reasonably high prices for a nice retreat in Mandurah.
Despite what you read in the media, AirBNB stock in Australia as nearly halved since prior to covid, as owners have taken the opportunity increasing prices gave them to cash out, moving stock into the hands of owner-occupiers instead of landlords.
So there’s two opposing forces at play right now: downward pressure on prices from increasing interest rates, and upwards pressure from insane rental returns and supply shortages. It would be arrogant for anyone to say they really know how this will play out.
If you don’t NEED to sell, it can’t hurt to hold out for a higher offer on your home. But if you can’t afford to roll the dice, price your home in line with what the market has actually been paying and don’t be a forced seller at a price that will send you to the wall later.
I still think Mandurah overall is some of the most underpriced real estate in Australia, so I’m personally still looking at potential investments every day.
I’m also noticing the beginnings of a pivot from the constant vilification of landlords in social media and mainstream media. It seems renters, politicians, and the wider public are beginning to realise that maybe landlords weren’t the evil capitalists pigs they have been made out to be for the last 20 years, and now that there’s a drastic shortage of people willing to be landlords, we kind of needed them all along. Some people do still fail to understand how markets work, however, and are blaming increasing rental prices on greed, rather than realising there’s simply no supply. Some even absurdly are asking for limits on rental price increases, as if that wouldn’t just drive even more people away from bothering to invest in property and make the problem worse.
Jason Smith
Stay informed and get the weekly Mandurah Real Estate email update by signing up below.
