There are more interesting articles, commentaries and analyst reports on the Web every week than anyone could read in a month.
Each Saturday morning I like to share some of the ones I’ve read during the week.
The weekend will be over before you know it, so enjoy some weekend reading.
More than half of Australians spend less than an hour inspecting a house before they buy it
We may be selective when purchasing clothes and groceries – but when it comes to homes, despite constant worry of price rises, it looks like purchasing has become far more impulsive.
According to this article from Domain.com.au many Aussies spend less than an hour choosing their property for purchase.
More than half of Australian homeowners spend more time watching a TV show than they would inspecting the property they buy, according to new research by ME bank.
The survey of 1000 property owners found 58 per cent spent less than 60 minutes checking out the house they then went on to buy and more than a quarter of those people found issues with it after their purchase.
ME head of home loans Patrick Nolan said the results were not surprising because many responded emotionally when it came to making one of the biggest financial decisions of their lifetime.
“Once they got interested and excited for their ‘perfect’ home they focused on how they can get the property instead of stepping back and strategically looking at the future requirements and costs of the house,” Mr Nolan said.
The survey found 36 per cent of people bought a home with rose-coloured glasses because they “fell in love with the property and overlooked problems” while 32 per cent said they “lacked experience and skill in inspecting the property,” and 11 per cent were simply “impatient and tired of looking.”
The biggest post-purchase problems included paintwork, construction quality, gardens, fences, fittings and chattels.
While 92 per cent said they would have gone ahead with the purchase even if they knew about problems with the property, Mr Nolan said if buyers took more time to inspect potential homes they would have the upper hand in negotiating a deal.
“Having that knowledge upfront and getting the property inspected can really empower people.
They could use that bargaining power in the negotiation process,” he said.
The survey did ask a mixture of first-home buyers and ‘second steppers’, who own a second or subsequent property, but it unclear when they entered the market which is why the question of rising house prices didn’t resonate with many of the respondents, according Mr Nolan.
But Taj Singh, director and co-founder of First Home Buyers Association said since there was a perception of a cooling market in cities like Sydney he had seen many first-home buyers jump at the chance of owning a property without giving it more thought.
“It’s the fear of missing out especially since the market has cooled – they don’t want to miss out on the opportunity of buying again.
They’re probably scarred by what’s happened in the property market previously when they’re outbid by foreign investors and mum and dad investors,” Mr Singh said.
“It’s more of an emotive sensation when you walk through a house, if it feels right, smells right.
Those are the things that motivates a buyer.
You can delegate a building and pest inspection.
As long as you can afford it, it’s in the right location and it’s not going to fall down that should be more than enough,” Mr Staver said.
In our experience if a buyer comes in for a fourth time they’re looking for a reason not to buy it,” he said.
Read the full article here
Dwellings under construction
Results show Australia has hit a construction boom.
At the last count – in the quarter ended September 2017 – there were 219,741 dwellings are under construction in Australia.
And that includes some 87,048 across New South Wales, mainly in Sydney.
There has been a swather completions hitting the market in more recent months, especially in Queensland, and that will continue for a little while yet.
In particular there have high volumes of high-density stock coming online since September.
Read the full article here
Surge in auction bookings for March
Going, going, gone!
The auction action is in full swing with no showing of a slowdown.
In this article for Switzer, John McGrath looks the number of auctions the market has seen.
Here at McGrath, we’ve noticed a significant increase in auction bookings across our Eastern Seaboard offices for the month of March, with volumes well up on the same period last year.
We currently have 38% more auctions booked for this Saturday (March 4th) compared to the first Saturday of March in 2017 across our network.
Also Sydney bookings are up 40%, with the Eastern Suburbs leading the surge with a 115% increase year-on-year, followed by the Sutherland Shire with a 64% increase.
This is a really exciting change for buyers and sellers alike.
We had a significant shortage of listings for sale last year because home owners were very reluctant to sell before buying in a moving market.
If they sold first, they risked having to wait several months to find a new home while prices kept rising.
Now that the market has peaked, sellers are feeling less fear and buyers are newly motivated with competition decreasing a bit.
Instead of competing against five to eight bidders at auction, they’re more likely to be up against three or four so they feel they have a better chance of purchasing.
In terms of auction volumes, Sydney and Melbourne experienced a major auction day last Saturday, with about 1,500 properties going under the hammer in Melbourne and about 1,100 in Sydney, according to CoreLogic data.
It was a big day because these campaigns were the first to have four full weeks of marketing after Australia Day.
Based on our bookings to date for March, we are expecting two ‘Super Saturdays’ on March 17 and March 24 in the lead-up to the Easter weekend.
Auction clearances rates are holding up well in both Sydney and Melbourne despite both markets beginning to cool.
In Sydney, auction clearances were tracking in the low 50% range in the final quarter of 2017 but we’ve seen an upswing this year, with CoreLogic reporting clearances in the 60% range over the past few weeks, and this past Saturday even higher at 71%.
Melbourne is doing even better with recent clearances around 70%.
Another interesting trend right now is the sale of properties today that failed to sell last year, when auction clearances were lower and buyers were a bit more cautious.
We had a townhouse in Randwick, in Sydney’s Eastern Suburbs that passed in at auction in December with no registrations or bids but sold this month for well over the asking price.
This is purely due to heightened buyer engagement in an increasingly balanced market.
Another really exciting change in the auction market is the re-emergence of first home buyers.
Read the full article here
House prices in Australia suddenly stopped falling last week
It would seem that the house price fall is coming to a halt.
An article on Business Insider look at the numbers and what this really means for the market.
Australian house prices were steady last week, bucking the trend seen since late last year.
As seen in the table below from CoreLogic, prices were flat across the country on an average weighted basis, including in Australia’s largest housing market, Sydney, which has led recent price declines.Source: CoreLogic
Aside from a 0.1% gain in Brisbane, prices were flat across Australia’s remaining mainland state capitals, a result that coincided with another solid increase in auction clearance rates despite a strong lift in properties that went up for sale.
While providing tentative evidence that house price declines may have stalled, it’s still far too early to determine whether this is the start of a turnaround for prices.
As the saying goes, one week does not make a trend.
Reinforcing the need for caution, prices across the country still fell by 0.3% over the past month, led by a 0.6% drop in Sydney.
Prices in all other capitals also weakened by 0.1% apiece.
Reflecting that prices were growing substantially a year ago, annual growth across the capitals slowed to 2%, down from 2.4% a week earlier.
In Sydney, prices have now gone backwards over the year, joining Perth where the median dwelling price fell by 2.7%.
Elsewhere, price growth in Melbourne slowed to 6.9% while gains of 2.2% and 1.9% were reported in Adelaide and Brisbane respectively.
While from an annual basis price growth continues to slow, the recent pickup in auction clearance rates suggests that trend may reverse in the months ahead should clearance rates continue to hover around current levels.
“We think there is already evidence that the slowdown in house prices is stabilising,” said David Plank, Head of Australian Economics at ANZ Bank, before today’s release.
“Base effects mean the annual house price figures will continue to slow for a while yet even if monthly prices are stabilising, but we would caution against focusing on the annual change over the seasonally adjusted monthly move as it will mean that turning points are missed.
“Importantly, the stabilisation of the monthly house price data [in seasonally adjusted terms] is consistent with the stabilisation in the auction clearance rate.”
As seen in this chart from ANZ Bank, there’s a more than reasonable relationship between clearance rates and annual house price movements in Australia over the past decade.Source: ANZ Bank
Given data on clearance rates and prices released today, it suggests that the housing market may have reached a turning point.
Read the full article here
The world’s most expensive homes sold in 2017
Ever wondered where the most expensive homes in the world are being sold?
Well we may have found the answer.
An article on thespaces.com looks at the most expensive homes sold in 2017 – and just for fun gives a sneak peak on the mansions still available.
Which cities stole the show?
They say home is where the heart is.
But if this list is anything to go by, the world’s most expensive homes sold in 2017 have been more heart-stopping than warming. After 2016 smashed records for the planet’s biggest deals, this year was not far behind.
There was a noticeable flurry of activity in the aptly named Golden State of California where the rich and famous – and we’re talking the likes of Beyoncé and Jay Z – flocked to snap up a piece of prime LA luxury.
But three of the most expensive homes were all inside one development in Hong Kong. Here is a list of the most eye-watering deals over the last 12 months (prices are in US dollars).
Mount Nicholson, Hong Kong
Sold for $149m
Another year and another world’s most expensive home sale in Hong Kong.
While just under the $154m price tag fetched by Peach Blossom in 2016, this 9,000 sq ft property – which includes a swimming pool, garden and basement carpark – in the Mount Nicholson development topped the leaderboard when it sold in September.
Mount Nicholson also boasted the second and third biggest home purchases in Asia in 2017 with two apartments selling for $76m and $71m respectively.
Snapped up by the same buyer, together they make up another transaction close to the $150m mark.
199 Knightsbridge, London
Sold for $120m
When Capital FM-owner Ashley Tabor dropped a cool £90m on a four-bedroom penthouse in prime central London this year, it became the most expensive residential purchase ever recorded by the Land Registry.
Not content with his lot, Tabor swiftly revealed ambitious plans to knock through into the flat he already owns next door to create a 15,000 sq ft ‘super-flat’, although it looks like his mega ambitions could have been thwarted by planners.
432 Park Avenue, New York
Reportedly sold for $91.1m
Another ‘super-flat’ in the making? A Chinese buyer has reportedly snapped up a trio of penthouse apartments in the Rafael Viñoly-designed supertall, 432 Park Avenue.
According to public records, the buyer went into contract on 4 December on the units – which span 11,906 sq ft over two floors – for the eye-watering sum of $91.1m.
It smashes last year’s $87.7m stumped up by Saudi billionaire Fawaz Al Hokair for the top penthouse in the tower, although he paid a whopping $10,623 per square foot, compared to this year’s more meagre $7,651. One of the trio of condos was designed by Kelly Behun and comes with huge, 10ft windows.
454 Cuesta Way, Los Angeles
Reportedly sold for $90m
Arguably the celebrity real estate purchase of the year, Beyoncé and Jay Z reportedly dropped a hefty $90m on a contemporary new-build mansion in Bel Air back in August.
The six-building Los Angeles property – with a 15-car garage, bulletproof windows and a helipad – was designed by mansion architect Paul McClean.
David Geffen’s Carbon Beach house, Malibu
Sold for $85m
Yet another California coastal purchase, media mogul Geffen’s house set on 10 acres sold in May.
A month later the buyer was revealed to be Mark Walter, founder and CEO of Guggenheim Partners, which owns the LA Dodgers baseball team.
39 Conduit Road, Hong Kong
Sold for $67m
This 4,971 sq ft penthouse in Hong Kong’s mid-level neighbourhood was the fourth most expensive home sold in Asia in 2017.
Unlike the properties at nearby Mount Nicholson, homes here come with parking spaces.
Three to be exact.
And a private swimming pool.
Read the full article here
Weekend video: Scientists agree: Coffee naps are better than coffee or naps alone
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