Wednesday, January 12, 2011

2 yrs Oversupply on the Sunshine Coast

On the Sunshine Coast we get a regular delivery of a Real Estate magazine called the My Property Preview. Over the last 6 months I look out for it for a few different reasons. Firstly it has an auction section which lists the last weeks auctions and their results. It has been interesting to see this section move further and further back in the magazine as auction clearance rates continue to plummet. The first thing I do when I get the magazine is turn to the auction section and circle the 'successful' auctions. The percentage over the last 6 months has been around 15 -25%. (if that)

I also always find it interesting to read some of the sprukers articles. The one which caught my eye last week was called "Getting Serious" by the auctioneer Jason Andrew. These statement was there:

After and optimistic start during the first two months of the year, auction clearance rates started sliding after February's peak of 39 per cent.
39% was the years peak after an 'optimistic start'. The optimism doesn't exist for 2011. 
Throughout the year, an accumulation of unsold properties had continued to clog up the supply side even further. Some experts are now saying there's around two years' worth of stock sitting on the Gold and Sunshine coasts and the 'bubble' theory is getting bandied about again.
Two years of stock sitting on the Gold and Sunshine Coast. This figure will only grow over the next 12 months. With retail down, small business' struggling to survive, and it now becoming very evident that property prices will fall in value over the next 12 months (and therefore there is no reason you would become a speculative buyer) stock will sore in 2011.

The article goes on to say that vendors are going to become more realistic, this is spruker talk for, vendors will drop their asking price and reserve levels to offload their sinking properties.

He also try's to push his own burrow down the road by but suggesting that if you are going to sell in 2011 then the best way is by:
If your serious about selling, the key will be to differentiate your property from the glut of properties already there. The best way to do that is via a carefully co-ordinated auction campaign - its a clear statement to the market that your committed to selling and you're investing in a result.
If you need some reasons not to sell your property by auction go here. The fact that you only have about a 15% chance of selling by auction on the Sunshine Coast should give you little motivation to pay for a auction campaign.

2011 will be a year when peoples properties go 'under water', both figuratively in terms of their values becoming less then their mortgage (watch out first home buyers) and for many literally.

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