By Herron Todd White
Our predictions for 2020 were boldly summarised as “If we had to have a wager on where the residential market would be in December 2020, our bet would be the same or slightly less sales than 2019 and median prices similar to or slightly below 2019”.
If we drew a straight line from early 2020 to now, we would say that the market has improved in terms of both sales volumes and prices and our prediction was overly pessimistic (strange for a valuer, I hear you say!).
However, that summary clearly overlooks a year none of us could have predicted or even imagined. After the initial shut down where we were all to hibernate for a period of time, the market seized up with a bleak outlook not only for the property market but for business. As the infection rate flattened and government stimulus measures were put in place, the property market started to thaw although it wasn’t until the HomeBuilder grant was released that we started to see a dramatic increase in demand for land and house construction. Our regional valuers also began to report an increase in demand in regional areas, particularly across the Atherton Tablelands, as a result of people trying to escape built up areas and also to become more self-sufficient.
As 2020 comes to a close and with the announcement that the Queensland borders will open to Victorian and all New South Wales residents from 1 December, there is some optimism in the air. We will start 2021 in a market with:
- Strong demand for vacant residential land with little supply and prices increasing;
- Many home builders having a significant amount of work booked for 2021;
- Activity and upward pressure on prices in the lower end unit market from both investors and some owner-occupiers;
- Strong demand for well-located owner-occupier units with limited stock;
- Reports of an increase in demand emerging for upper end and prestige properties although not to the same scale as being experienced in southeast Queensland;
- Very low residential vacancy rates in most locations in far north Queensland;
- A healthy established home market with limited stock and upward pressure on prices;
- An active rural residential market constrained by limited stock with increasing prices;
- A positive shift in sentiment to regional locations where demand has been weak for years with many remote regional areas possibly achieving more sales in 2020 than in the past five years combined;
- Record low interest rates, relatively easy access to finance and the possible softening of the responsible lending guidelines.
Speak with a Cairns Mortgage Broker today.