Whether you are a real estate agent, conveyancer, mortgager broker or an actual property buyer (prospective or otherwise), there seems to be one thing in common that I keep hearing (and seeing) – there is nothing available!
Now this isn’t QUITE true – if you wanted a house, any house, then yes if you jump online or open the paper then you will indeed find a selection of homes with 4 walls and a roof – but there is far less than we are used to and more often than not you’ll still find them with an “under contract” banner across the top. Entire price points and housing categories have joined the endangered list, or so it seems.
Let’s take Mount Sheridan as an example – this is an area which has long been a popular spot for first home buyers and downsizers alike for its affordability and mix of older 1980s block homes on larger allotments and late 90s/early 00s cottage style homes with tighter boundaries. For forever and a day (read: pre-2020), you could reliably find a swathe of options in this area in the low $300,000 range, or even high $200,000s if you were having a lucky day. Today? Hold on to your hat. A search for a house of any description under $400,000 yielded 6 results. 4 of those were under contract. I would suggest anyone targeting that area and budget move quickly….
Now why such slim pickings? Surely people still need to sell? Well, we still have the chicken and the egg issue of do you sell first and risk not finding your next home, or buy first and take the risk on selling in time? I have had a lot of discussions with vendors over the past year about making that call, and both are certainly options, but this can be a hard one for many to get their heads around.
Another factor that is not widely discussed is the number of people that have fixed their mortgages over the past 2 years to take advantage of record low rates (which have now departed). If you fixed your mortgage at 2% for 2 years, then you have locked yourself in place for the time being with that property – unless you want to pay sometimes painful exit fees (speaking from experience).
Tight supply continues to mean strong prices, even in the face of rising interest rates. With no slackening in demand, particularly in that mid-market price range, there are still plenty of reasons to think of selling
Tom Quaid is the REIQ Zone Chair for Cairns