Property Values Correcting Down
At a recently held investor conference 12th October held in Melbourne, experts from Citibank, Pepper Home Loans, and IFM Investors, warned that the residential property market could see a downward correction of up to 20% across the board, clawing back the gains it had made through the Covid pandemic. Obviously inflation and interest rates will be the drivers of this and are already impacting.
I am regularly completing property profiles for clients that are looking to purchase or refinance. These reports reflect a range of values, low, midpoint, and high. Back on the 22nd September I completed a report on a Port Macquarie three bedroom villa. At that stage, just three weeks ago, the midpoint value was 642k. I updated the profile on the 13th October and was surprised to see an adjusted midpoint at just 587k. That’s a massive drop in excess of 8.5% in that very brief period. Now obviously the property market is segmented and units, villas and apartments may be impacted with steeper falls? However , in another example I received a resulting valuation late last week for a purchaser on a Wauchope Torrens title home. The valuation barely met the purchase price and it was suggested by the valuer at the time that moving forward in say four to six weeks, that property could be closer to 20k down on the purchase price.
Thinking about the above it is now more than ever critically important that you armed with reliable and current data in order to make decisions on property purchases. Working closely with the whole COMPASS team will enable this.
Please reach out at any point should you wish to even just check on where your property is currently sitting value wise. Ring Michael on 65832211.