A snap shot of what is happening on the ground in Melbourne

Discussion in 'Property Market Economics' started by Lisa Parker, 31st Jul, 2018.

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  1. Triton

    Triton Well-Known Member

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  2. Matt87

    Matt87 Well-Known Member

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    Do you feel Hawthorn has over supply of apartments?
     
  3. The Y-man

    The Y-man Moderator Staff Member

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    There isn't a huge number of new towers going up - still mostly old stuff.

    The Y-man
     
  4. Triton

    Triton Well-Known Member

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    What are people's thoughts on west Preston, between Murray Rd and regent St? Good area for ppor?
     
  5. johnmteliza

    johnmteliza Well-Known Member

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    The Mornington Peninsula is without a doubt the safest area in the ongoing Melbourne property price collapse. In Mornington and Mt Eliza specifically, agents are very upbeat about the market and evidently continue to achieve strong results. This article was only published a couple or days ago and provides a very clear idea of what is currently going on. The Mornington Peninsula is operating as a seperate market to Melbourne. It is benefiting from being less inflated when compared to Melbourne. Also, don't forget the long term changes occurring in terms new infrastructure bringing the area closer to Melbourne and changing wants among buyers for bigger blocks and better lifestyle. Suburbs by the bay still continue to be of high interest among buyers and consequently prices continue to rise. Even the Bellarine peninsula and to a lesser extent Phillip Island have experienced strong gains within the past 12 months. This clearly shows a general shift in buyers wanting quality coastal lifestyles.

    This is all while inner city Melbourne records its biggest declines in recent years. Essentially Melbourne is reverting back to its early 2016 values while other areas of Victoria continue to climb. In the background, the attention on the regional markets is also benefiting the Mornington Peninsula. This is because the Mornington Peninsula provides both a regional market yet is also close to Melbourne for commuters and is considered a city market. It is an ideal position in a declining inner Melbourne market. The outer suburbs have experienced strong growth due to their affordability in recent months. However, as in any city boom this will be short lived. On the other hand, the Mornington Peninsula offers more value than just being a outer suburb area where houses are bigger, cheaper, affordable with lower density.

    The statistics speak for themselves you can see below. Be mindful that these are general statistics which means some suburbs in these areas can still be performing strong.

     
  6. alicudi

    alicudi Well-Known Member

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    Hi

    I have been on the ground and my dealings with agents in and around Mt Eliza has been somewhat different to what you have noticed. Some agents which have become regular associates that I deal with have informed me that things are quieter now and they just don't have the same level of interest anymore and can't sell properties as quick as they could have when compared to say the start of 2017.

    However the property values that I enquire about are on the bottom end of the scale, ie: units/apartments up to $350,000 and houses up to $750,000.

    Regards,

    alicudi
     
  7. Connor

    Connor Well-Known Member

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    Same feelings from a couple of agents in Frankston that I've spoken to also. The market and buyer sentiment is nothing like it was 8-12 months ago. Buyer urgency is non existent.
     
    alicudi likes this.
  8. johnmteliza

    johnmteliza Well-Known Member

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    Hi again alicudi

    You will notice the article provided was a reflection from agents in the blue chip areas which are far more expensive than $350,000 to $750,000 to enter. The most affordable area mentioned was Mornington with a median of $882,000. Your on the ground research may be explained by the agents continuing to push for higher prices and therefore not attracting as many buyers in these more entry level markets. While in early 2017 the agents may have not been as optimistic and therefore weren't asking as highly. It is a delicate task for the agent to ensure a reasonable yet strong asking price. In Mt Eliza which was mentioned in the article, there are very, very few houses which you can buy between $350,000 to $750,000. Even the units are expensive. So your on the ground dealings is not a reflection specifically this suburb's housing market. It may be reflective of a few entry level areas of Mornington's unit market. Nonetheless, last year was particularly strong of the unit market on the Mornington Peninsula and it continue to have the strongest growth rate of any area in Melbourne. Similarly, as you can see the broader housing market is also performing well in terms of the statistics. Overall, the agents experience in one segment of the market isn't reflective of the entire Mornington Peninsula market and is especially not representative of the more expensive areas.
     
  9. johnmteliza

    johnmteliza Well-Known Member

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    Generally as the broader Melbourne market deflates, suburbs such as Frankston within the Melbourne market will not gain as many buyers.
     
  10. JamesP

    JamesP Well-Known Member

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    What about the outer south east? I live in the area and the market is still hot, no signs of a downturn. Prices are still increasing at the same rapid rate.

    49 Edrington Park Drive Berwick Vic 3806 - House for Sale #129241558 - realestate.com.au
    10 Alsop Lane, Berwick, Vic 3806 - Property Details (sold 930k)

    It only started moving here 18 months ago and it's still going. Start of the year all those homes were 100k less. Same with Olde Berwick.

    All the 350k estates shot up overnight 3 years ago. Cranbourne/Pakenham followed and they've now all cooled slightly.

    But the more premium estates hardly moved initially and they're still catching up
     
    Last edited: 11th Sep, 2018
  11. berten

    berten Well-Known Member

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    Yeah I call BS. Agents I spoke to at SeaChange Realty recently were frank that the "hype" is gone out of the Peninsula market.

    I expect much like Hobart they are just a little behind the curve going down as they were coming up.

     
    Last edited: 13th Sep, 2018
  12. johnmteliza

    johnmteliza Well-Known Member

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    You can't call BS when the actual data shows the demand is still there and appears likely to continue growing. For example, clearance rate of above 70% compared to Melbourne's low 50% or so as of late. The blue chip suburbs have also significantly increased anywhere between $300,000 and $815,000 in the last 12 months. Also, you can't talk to a single agency with relatively few sales and determine what is occurring in the whole market. This is the same way you can't talk to agents in a specific area. For example, the agents selling in the inland suburbs on the Mornington Peninsula will have a different view to those selling on the booming port phillip bay side. You would be better asking Eview Group, Harcourts, Nicholas Lynch, Peninsula Sotheby's International Realty or RT Edgar due to their larger amount of listings across a broader area.

    You only need to read this article 'Outsiders and locals to keep Mornington Peninsula prices steady in spring' to get an idea of what the agents are actually seeing.

    "QUICK sales, packed inspections and outsider demand should see Mornington Peninsula sellers continue do well this spring. “There is no doom and gloom here on the peninsula. Some heat might have come off the market but sellers are still getting strong prices and homes are selling quickly.” While prices and sales in many Melbourne regions have slowed, local agents said the peninsula was a very different market and still performing strongly. “The peninsula continues to attract buyers from Melbourne suburbs and we saw a stronger winter market this year compared to last year,” agency director Nicholas Lynch said. “We see all property segments doing well because of the range of buyers heading to the peninsula,” Mr Lynch said. “There are few signs of a slowdown in the peninsula and for example, Mornington is among the most search suburbs on realestate.com.au.”


    RT Edgar nominated Mt Eliza, Mt Martha and Mornington as suburbs which should perform well this spring because of demand from family buyers and also investors. Mr Lynch noted that high demand and limited supply meant prices would remain strong in the region. He expected prices would continue to rise due to demand and because the peninsula was “becoming a destination of choice for buyers from the city, interstate and also overseas”." 03 SEPTEMBER 2018.

    The article used examples to show that properties were attracting in excess of 40 groups and gain multiple offers. Examples are also used to show how some properties have sold for considerably more within the past 12 months. Mornington has also become the 2nd top suburb for highest property price growth this year by REIV.

    I agree Hobart is a more volatile city and probably will be just a little bit behind in going down. Generally the the slowdown in Sydney and Melbourne is expected to depress the other city markets as well. But the Mornington Peninsula is clearly very different due to offering more affordability on the doorstep of Melbourne and being less exposed due to the vast amount of retirees in the market.
     
  13. berten

    berten Well-Known Member

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    Okay now I really call BS. We both know that almost all sales in the area are by private sale not auction.

    A spruiker article from realestate.com.au is meaningless.

     
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  14. johnmteliza

    johnmteliza Well-Known Member

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  15. alicudi

    alicudi Well-Known Member

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    Hi

    I know the owners of a couple of those offices and have known two of them since the late 1980's, in fact one of them was the person that trained me at Ray White head office back in the early 1990's.

    Anyway you need to realise that these people are sales people and are doing their absolute best to sell properties and won't be actively promoting any negative issues.

    My source of the downturn and reduction in demand in the Mt Eliza area also works in one of these offices.

    Regards,

    alicudi
     
  16. johnmteliza

    johnmteliza Well-Known Member

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    The agents I quoted above are very professional and have clearly supported what ever opinion they have about the market with reliable facts including sale prices, number of potential buyers, number of offers/bidders, demand to supply level, location of where buyers are coming from, clearance rate, increase in performance this year compared to last and data from reputable realestate.com.au. These are not opinions denying any negative issues you believe exist. These are just comments on the core data and facts which is the most reliable source there is. Fortunately, the data and summary by the agents support a belief that the market is performing really great right now and is expected to continue to in the future.
     
  17. johnmteliza

    johnmteliza Well-Known Member

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    The downturn and reduction in demand that you claim is non-existent in the data and among other agents. You have created a belief off of a random agent's comment not only about Mt Eliza but about the whole Mornington Peninsula market. Your comment is unreliable.
     
  18. alicudi

    alicudi Well-Known Member

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    Hi

    Due to my long term beneficial relationships with some of the agents in question and my expertise in this area I prefer not to make any further comments about Mt Eliza for now, however please understand my knowledge is based on studying the area since the early 1990's, having completed an agent's representative certificate and also completing a property valuation degree.

    Regards,

    alicudi
     
    craigc, johnmteliza and Now or never like this.
  19. Now or never

    Now or never Active Member

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    Agree with these sentiments. You know sales are trending downwards when agents you've hardly met start ringing you with "bargains".

    Disclaimer...I own in Frankston South and wish it wasn't true !!
     
  20. berten

    berten Well-Known Member

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    Mt.Eliza John, I take it you live an work down so there lets be factual:

    Auctions account for a tiny, tiny, TINY sliver of home sales in the main peninsula markets, likewise Melbourne's outer suburbs are generally private sale too.

    A+ properties are moving in Mt Eliza, Mornington and Mt. Martha, Sorrento but almost everything else is languishing

     
    Last edited: 14th Sep, 2018