Saturday, August 29, 2009
I feel false positivity....still, it's positivity.
Well after the last few weeks I have become more and more confused by, what else, but the lovely media reporting an overwhelming number of positive news about property prices. While this in essence is fine and is finally showing a leaning towards positives rather than doom and gloom, there is one eency weency tincy little problem. I am STILL NOT SEEING IT!!!! The Brisbane suburb that I watch (where I have an IP) called Ferny Hills, as well as Ingham in North Queensland, where I live, property is ticking along.....stable, not earth shattering, not idle, just moving.
What I am noticing is the number of stock coming on the market. In Ferny Hills for example, A LOT of houses are coming on the market and are hanging around for a while. They are your typical, highset built in underneath neat 3brm base stock houses. This is unfortunately doing something to our market, it's keeping it low. These are the entry properties, people flogging off stock, it's not the type of properties that are overpriced, the type that usually drive up the suburb profile.
I can conclude two things form this scenario. Either people are seeing this as an opportunity to get out, in fear of the interest rate rises, OR, investors/owners are ready to upgrade and are flogging off stock to open up cash for upgrading. For months, hardly any activity and now, it's all on all of a sudden. I hope this scenario is not being repeated around Australia, as I see it as detrimental to future prices. What I do like though, is how neat these places are inside, it's quality lower end stock.
Ingham, while being a very different market is doing a similar thing. Lots of lower end stock available, quality a bit low but acceptable, but there is also a small section of expensive, overpriced houses that are being listed. This gives me hope.
So yes, while the long term does indeed look rosy for investors/home owners, currently I wonder whether the interest rate rises we are heading towards are keeping prices low. Oh well, back to my ponderings....