NSW Newcastle 2020

New build?

 

Oh well bye bye property market. Was great while it lasted. Only way it bounces hard is if there are jobs and/or wages growth. Don’t see how that’s going to appear in the near future.

Better off buying big 4 bank shares at these levels. Cheap as chips , high yield and fully liquid. Be greedy when others are fearful....

Unless of course we’re looking at another world war.

 

I think their yield will be lower as their profit will shrink as well.

 

its not just newcastle. every region will be affected.

 

Hi lovely people of Newy and surrounds. I am hoping to get some advice from this forum and those who know the property market well.
We have been trying to buy a PPOR for about 12 months now and have no secured anything yet due to a number of factors (mostly being picky, trying to find something affordable in the areas we like). Now COVID has happened we are still looking and we are some of the fortunate who have not lost any income. However we now have a baby due in October so we need to get something in the next few months. Our very upper limit for buying is $800k.

My questions are:
Do you think the Newy market will drop much at all, or what do you think the impact will be?
At this stage I havent seen a price drop but I have noticed the demand drop off, which I assume will have to lead to a price drop? How long do you think it will take for a drop to occur, should we try to wait as long as possible before buying?
I'm quite surprised that new stock is coming on the market - do you think this will continue?
Do you have any general advice?

Thanks so much in advance!!

 

@tomlemke is the man to talk to!

 

I’m no expert, but at present I think all cards are off the table for now until we get a better picture of how things are playing out. Even the media experts would have to admit it that they don’t know right now.
I guess keeping an eye on what’s listing and what’s selling is your best bet, what the stock levels are like and how long they are taking to sell.
It also depends on your price point. If you are investing in the lower third price point I’m thinking you would be better off and more likely to be able to hold on to that property, but all depends on financial capacity and the demographics of the area you are investing in and it’s employment profile,

 

Yep down by how much is the question... minus 30% off property and 15% unemployment rate would probably be a good result in 12 months

 

I think you’re right in that the drop off in demand will eventually lead to price drop but that will apply to all of Australia. Price drop should be starting now that we are on Stage 3 restrictions to when they start to ease restrictions and people can attend open houses again.

I think APRA and the banks will loosen lending criteria next few months as the demand drops to encourage lending so may increase your borrowing capacity.

sit back and watch the market and banks next few months great time to buy!

 

it will make for interesting viewing but will be quite a sad / frustrating time for many as job losses and dislocation impacts increase

 

I’m a big knights fan

@tomlemke any update? Hope you are doing ok

 

The phone basically stopped ringing after Sunday the 28th announcement with the further lock down restrictions, buyers from the middle of last week have seemed to of come to terms with the new rules and have been booking more private appointments. We have had a couple of people who have offered ridiculous offers on some of the homes we have had listed.
I'm sure we will see plenty more of this, there will be some good opportunities over the coming months. I don't think we have reached the bottom yet so i would be skeptical about jumping in just yet but it would depend on your circumstances.

We had property go to auction on the weekend and the opening bid was $100,000 for a rundown house in Whitebridge on 1000sqm2. This would of sold for at least mid 500's prior to the Coronavirus and it ended up selling for $460,000.

My colleague put this property on the market last week and they have done 30 private appointments so far, out of all those inspection only one person has made an offer of $625,000.
https://www.realestate.com.au/property-house-nsw-rankin+park-133296770

I heard another property sold in Merewether at Auction three Saturday's ago for $4.65m and the buyer walked away from his deposit on the following Monday.

I'm probably more optimistic now than i was when all this started happening, I feel the low to middle range properties will continue to turn over well ($350,000 - $800,000) the main driver in this price range are mainly first home buyer's.

I was skeptical prior to this virus as I felt the market had lifted too quickly, we were seeing results well above the previous peaks in 2017 which cycle wise it never seems to happen that quickly.

Most sellers now will hold off unless they really need to sell, with the inquiry we have been receiving over the last week along with the lower supply at this stage it will keep prices propped up. No ones has a crystal ball and these are just my thoughts currently, i look forward to reading back over this post in another months time.

If you don't need to sell sit tight!

 

0.25 or 10%?

 

Thank you Tom, appreciate the detailed and balanced insight.

 

10% deposit, it was sold under auction conditions, the risk here is that the vendor could potentially take the buyer to court for the difference in price when it ends up selling.

 

Absolutely, thats a big fall, hope he sought legal advice.

Perhaps mental health concerns, considering everything going on in the world.

 

I walked away from a new Merceded and got my deposit back in mid March. No need for a new car when you cant drive everywhere. Look forward to deploying that extra cash soon. I know its sad to say but cash at the moment is king, and people that are forced to sell properties, either investment properties or AirBNB's in this market over the next few months ....the folks who are buying those at a 20%-30% discount will do well if the world doesn't end.

At the end of the day, there is still a fixed cost to land controlled by government valuations and a fixed price for building materials and new homes. If you know replacement costs of property, use that to your advantage.

Good luck to all -- this is a once in a generation opportunity. Be greedy when others are fearful.

 

looking for a recommendation for a sparky and roof repairs - appreciate any leads.

 

I'll PM you