The month in review: Newcastle
By Herron Todd White
December, 2009
At the start of the year we were wondering how the jobs
market was going to hold up, and now it would appear
that the predicted high unemployment numbers are not
going to be realized. The concern now is how quickly
future interest rates are going to rise, and what effect this
may have on the recovering property market.
At the start of the year we suggested that the sub $400,000
price bracket located within 15 kilometres of the CBD
should remain steady with the First Home Owners Grant
set to encourage activity in the market. Well, the lower
end of the market didn’t remain steady, it actually firmed
in value and agents couldn’t get their hands on enough
stock as houses regularly sold within weeks of listing
(median sale prices lifted).
Inner city suburbs certainly held up in value terms whilst
experiencing longer sale periods (as we predicted), and we
are now starting to see more activity in this market. Also,
as we forecast, holiday areas such as Port Stephens and
The Entrance saw property values weaken, particularly
strata units, as investors withdrew from the market. Prices
in these holiday areas appear to have bottomed out in
most cases and we are beginning to see investors return
to the market.
We suggested that sometime in 2009 could be the right
time to purchase while we were in a buyer’s market and
for many purchasers this was indeed the case. However, it
may be that some buyers at the lower end of the market
possibly paid a premium for their property (particularly
first home buyers) and we will have to wait to see what
effect the withdrawal of the increased First Home Owners
Grant (as at 1 January 2010) together with increasing
interest rates has…
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