November 2014 has gone down in our 25 year company history as our biggest sales month on record with $1.27 Billion worth of real estate sold across our 62-office network.
November was an incredible month for many markets but particularly Sydney, with more than 5,000 homes scheduled to go under the hammer over those five Saturdays – the biggest month on record.
As you would expect, the weight of skyrocketing volumes has pushed clearance rates down a bit from the boom level of 80%-plus back into the 70% zone but that is still a remarkable level of clearance when we’re talking about more than 1,000 properties going to auction on some Saturdays.
Forget the bubble talk. Forget the doomsayers. What’s going on here is a glowing testament to real estate being one of the safest and most effective forms of wealth creation around. Look what’s happened to property prices in the past two years – they’re up more than 25%, according to RP Data. That’s really amazing stuff (although we do want this to slow down a bit, as a period of consolidation is vital after a significant burst of growth).
About 70% of the Australian population owns their own home – either outright or mortgaged, so 7 out of 10 Australians have just made significant, life-changing money through real estate – in many cases the equivalent or more than a year’s salary. Reason to celebrate? Yeah, I think so.
Home owners are already thinking of ways to use that money, with new research by Westpac showing renovating is currently at a four-year post-GFC high, with one in four renovators using newfound equity to improve their homes. This equity is also propelling the record level of investment we’ve seen of late, as more people recognise the long term benefits of property investment.
In terms of market predictions for 2015, things are inevitably going to slow down next year, especially in Sydney which has experienced such phenomenal growth in 2013 and 2014.
It will be interesting to see if the traditionally strong Autumn season in 2015 plays out that way before a cooling in conditions over Winter, or whether we’ll start the year on the back foot a bit given the huge volume of sales going on right now. Time will tell.
The latest RP Data report has Sydney house prices up 1.1% for the month of November, with apartment prices up 0.8%.
Looking back over the year, here’s what happened in every major capital city market from January to November 30.
Sydney
House prices up 13.4%, apartment prices up 8.2%
Melbourne
House prices up 6.5%, apartment prices up 1.6%
Brisbane
House prices up 4%, apartment prices up 4%
Canberra
House prices up 0.1%, apartment prices down -0.5%
Perth
House prices 0%, apartment prices up 2.1%
Adelaide
House prices up 2.5%, apartment prices up 2%
Hobart
House prices up 0.7%, apartment prices up 2.3%
Source: RP Data
Looking forward, there will be a lot of auctions on the last Saturday before Christmas – December 20. The huge rush of listings that came onto the market in early to mid-November means the Spring selling season is going to finish very late this year.
If you’re looking to buy or sell before Christmas, I wish you all the very best. Here’s hoping a sensational new home or a sensational sales price is just around the corner for you.