The month in review: Regional Vic
By Herron Todd White
June, 2010
LEETON/GRIFFITH
At present there is no one distinct market segment that
has the play. During the past few months the greatest
number of sales has been in the $200,000to- $300,000
price bracket, but the volume has not by any means
been significant. Our market has become dominated
by fence sitters and tyre kickers. Uncertainty and fear
regarding affordability, employment stability and local
economic conditions have caused a significant number
of prospective buyers to put their dreams of home
ownership in the too hard basket for the time being. The
market appeared to have bottomed out 12 months ago,
but, unfortunately, unless our buyers get a confidence
revival we are in for some new lows.
ECHUCA
Loosely speaking, ‘local’ buyers are the mainstay driving
demand in the local market place, with a small but not
insignificant influence from out of town buyers (mostly
Melbourne) who seem to place a floor in the market.
The term ‘local’ has been used to cover a broader group
including:
• Those who relocating within the Echuca-Moama
township.
• Those who are relocating from more remote/satellite
centres/regions (e.g. coming into town off farms).
• Those originally from Echuca after living away for a
period of time.
The demand appears to come at varying levels of value
- from first home buyers (mostly from existing Echuca/
Moama residents) through to higher end properties for
those returning who may have had exposure to stronger
residential markets elsewhere, and whose purchasing
power is consequently significantly stronger in the
Echuca-Moama Market place relative to where they have
come from.
MILDURA
A quiet month for the real estate agents has been evident
in Mildura – is this winter coming early and buyers going
into hibernation or economic circumstances? Cautious
is the present description of the buyers in the market.
Certainly the rapid increase in interest rates has slowed
the energy of both owner-occupiers and investors.
The most active buyers in the market have been focussed
towards the lower mid range of the market and most
inquiry is in the $220,000 to $350,000 price range. The
low-end market has been noticeably quieter and this is
where the interest rate rises have panicked the buyers.
The dramatic first home buyer activity in 2009 has
resulted in only limited numbers of first home buyers left
in the market now and the psyche is despondent due
firstly to the interest rates but secondly the perception
that they have missed the boat for the generous amounts
that were available. In reality there has now been only a
relatively minor drop in the grant in Victoria.
Some out-of-town (many internet) buyers have been
active predominantly in the $300,000 price range where
$280 to $300 per week is the common rental.
SALE
The Gippsland residential market continues to be strong
with varying degrees of buyer interest over the past 12
months.
The First Home Buyers Grant ensured an initial surge at the
lower end of the market for both established properties
and new dwellings. The decrease in government funding,
as well as rises in interest rates has now slowed first
homebuyer interest.
Demand continues to be steady at the affordable end of
the market with a noticeable decline at the higher end,
possibly due to the increased interest rates.
Land values have risen quite significantly throughout the
region as a result of lack of supply, encouraging greater
interest from developers.
With the increase in interest rates and reduction in
the First Home Buyers Grant, investor confidence has
returned to the market over recent months with rental
returns continuing to be strong throughout the region.
Local agents have advised that retirees are returning to
the area with improved levels of enquiry from cashed up
purchasers leaving the Melbourne market.
Coastal and Lake Areas are showing a thinly traded market
with a reduction in property values and sales.
Latrobe Valley continues to be very strong with affordable
areas of Morwell, Moe and Churchill showing a gradual
increase in property prices.
East Gippsland is showing a strong demand for new
housing with new construction activity declining due to
limited availability of vacant land and prices increasing
accordingly. Agents have indicated however that house
and land packages are showing a greater appeal to the
younger demographic.
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