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WHAT WILL SPRING BRING?
Dan White Managing Director, Ray White Group - Fourth Generation White Family
Our August 2023 sales results officially certified the renewed and broad-based resurgence in the residential market that we have been seeing since late May 2023.
There were many extraordinary results from our residential offices during August, the most remarkable being a record month from Ray White Lower North Shore Group, writing $216 million in sales, and from Josh Tesolin and his team at Ray White Quakers Hill selling 135 properties.This revitalised market rewards those businesses who fought hardest during more subdued times. Our Chief Economist, Nerida Conisbee, has written about some of the reasons as to why we are seeing the market behave in the way that it is. The Australian commercial market tells a less exciting story. There remains a more significant disconnect between where buyer’s see value and the urgency of vendor’s to genuinely test the market to see where value sits. Transaction numbers reflect this divide. Aside from these figures and our awards nights that were held for our Victorian, New Zealand, South Australian and Commercial networks, the highlight of the month was the extraordinary response from our New Zealand members to the release of NurtureCloud. We are now live across our international network with NurtureCloud, enabling our business leaders to provide their teams with a unique and AI powered platform to communicate with customers. We are now well into an extensive trial of the next few modules of NurtureCloud that we hope will enable us to provide both buyers and vendors with a significantly improved experience. A huge thank you to all our members in this trial, especially Vince Carnevale and his team at Ray White Pascoe Vale. What will spring bring? There will be enough stock to record some big results, maybe not at 2021 levels but not too far off. So much depends of course on the broader economic sentiment and how that influences buyer behaviour. One senses it would not be prudent, nor worth tempting fate, to revise our budgets just yet!
We wrote $6.9 billion in sales in August across Australia and New Zealand. This was 14 per cent higher than the same month in 2022. Remarkably, it was only four per cent down on 2021 - a year that broke all the sales records and has been disclaimed by many as a ‘statistical outlier’! In May, we reported a small, but identifiable, increase in new listings coming to market especially on Australia’s east coast. This was very unusual - new listings normally drop in the winter months. Interest rates were still rising, and given that the expectation was for an increasingly depressed market, was this a blip? But the trend became firmer in June, and stronger again in July. Were more listings coming a result of the impending ‘mortgage cliff’ that so many forecasters were predicting? Hard to say: vendors that are coming to market as a result of financial stress will usually keep that fact to themselves. We listed 10,500 properties during August - 12 per cent up on last year and more than 20 per cent higher than two years ago. Buyers, including potential sellers that intend to repurchase, now have a lot more property to choose from. Given that our listing authority numbers (i.e. properties that will formally come to market in the next few weeks) are growing strongly, the market is very well-stocked for Spring. While there is emerging confidence in New Zealand, the national election set for mid-October is just one reason why it is lagging Australia in terms of new listing activity. Some have predicted that this increase in listings would result in a ‘buyer’s market’. This hasn’t happened, at least it hasn’t happened yet, and it may not happen! The median number of days it took us to sell the properties we sold in May was 37, and in August it was 31. Auction clearance rates in Australia have risen from 60 per cent a year ago to just over 70 per cent today (though are still about 10 per cent below their peak in October 2021). Neoval’s August price indices for August showed renewed price growth in our major markets.
16 –September / October 2023
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