Greetings from Scoutable and welcome to our September Wrap Up.
September saw 2,688 properties scheduled for auction across Sydney, with an average clearance rate of 80%. This is up 25% from last year's September average of 55% (3,432 properties).
Melbourne saw 2,718 properties scheduled, with an average clearance rate of 79%, up 21% from last year's 58% average (3,922 properties).
Brisbane saw 392 properties scheduled for auction, with an average clearance rate of 55%, up 11% from last year's 44% average (628 properties).
Today marks the Reserve Bank of Australia's third cash rate cut this year. The aim of the RBA’s rate cuts is to stimulate the economy and create more jobs. What does this mean for your pocket? The RBA has cut the cash rate to 0.75 per cent, following up its back-to-back rate cuts in June and July. Shane Wright, Senior Economics Correspondent for The Age and The Sydney Morning Herald reported, if the banks passed on the cut in full, it would save $55 a month on a $400,000, 30-year mortgage. Shane further commented that when the bank started cutting rates, there were some concerns that instead of boosting the jobs market, the move could power-up the property market. Core Logic's daily measure of dwelling values suggests that is what has occurred. Bank Governor Philip Lowe has played down concerns about the lift in dwelling values, saying the RBA is closely watching credit growth which has yet to show signs of strength.
On the other side of the coin, does anyone lose out when rates get cut? Domain reporter, Sue Williams, investigated the five biggest losers in cash rate cuts:
Savers - Savers are earning less on interest in both standard savings accounts and term deposits. Matthew Hassan, Westpac senior economist, said there is about $526 billon in savings across Australia. If the banks pass on a full rate cut, the savers will lose about $1.3 billon in interest.
First home buyers – Firstly, saving a deposit is hard and the rate cuts don’t help as money in the bank isn’t earning much interest. In fact, Sally Tindall, RateCity research director, commented that ‘Many deposit account rates have fallen even below inflation in relation to both term deposits and saving accounts’. Secondly, buyers are able to borrow more with less interest on loan which increases the buying power and number of competitors in the market place which drives property prices up.
Retirees - Retirees living off the interest on their savings will see reduced earnings and may find that the new low rates could well be swallowed up by bank charges alone.
Mortgage holders on fixed interest - The gamble with fixing your interest rate is when interest falls, you are paying more interest than people on variable rates.
The banks – Most of us don’t really care if the banks are making less money but we need the banks to perform well to assist in the economic recovery.
On the ground, we have noted a strong turnout of buyers at inspections across Sydney and Melbourne, especially within the inner ring suburbs. However, there are many buyers ‘just window shopping’ with an average of just three buyers on a property at the end of the marketing campaign. Auction results are starting to exceed vendors' expectations, with many properties selling well above reserve. The increased competition is due to the return of buyer confidence and the lack of quality stock. We are seeing well priced opportunities off market across various price points.
If you, or someone you know, are in the market for a new home or investment property, engage Scoutable. We know property and we'd love to find the perfect one for you.
Until next month,
Kellie Landrey | Principal Buyers Agent
IN THE NEWS
RBA DROPS CASH RATE BY 25 BASIS POINTS
https://www.rba.gov.au/media-releases/2019/mr-19-27.html
HOUSE OWNERSHIP IS OUT OF REACH FOR 'DISENFRANCHISED' MILLENNIALS
https://www.abc.net.au/news/2019-09-28/disenfranchised-millennials-property-ownership-unaffordable/11555420
TO BUY OR NOT TO BUY
https://www.news.com.au/finance/economy/to-buy-or-not-to-buy-australian-housing-prices-set-to-shift/news-story/42e94e8076362fbe9f296ec6c9023094
PROPERTY OF THE MONTH
2B MARGARET STREET, WOOLWICH
Woolwich is a suburb on the Lower North Shore of Sydney, situated 11km north-west of Sydney’s CBD. Woolwich’s population is typically wealthy according to the Australian Bureau of Statistics (2016 census) with a median household weekly income of $3,211, compared with the $1,438 Australian average. 72.5% of the residents were born in Australia and 78.6% only spoke English at home.
The property of the month is located on the Woolwich Peninsula. ‘Glen Mahr’ is a Victorian sandstone dwelling set on 2,000sqm of land. The photos do no justice to the garden, which is beautifully manicured, deliciously fragrant and vibrantly green. The gardens wrap around the property in three sections - the pool area, the lower lawn and the gardens off the kitchen and driveway. The pool area and verandah provide views out to the harbour, including the Harbour Bridge. The house itself accommodates both informal and formal living spaces across the ground floor, which also provides a bedroom, bathroom and study. The upper level accommodates four bedrooms and two bathrooms. There is carport parking for two cars and a basement cellar/workshop.
The price guide range is $7,300,000 - $8,000,000.
The rental guide is $2,500 per week.
If you'd like to know more about this property or any others, please get in touch.
