Sales Trends: Houses and Units
May 2023 witnessed a substantial 31% year-on-year drop in dwelling sales, impacting both houses and units. House sales plummeted by 31%, while unit sales saw a decline of 28%.
These figures underscore the market's ongoing transformation, driven by shifting consumer preferences and demand dynamics.
Units in the $400,000 to $800,000 Range Dominate
A striking trend is the dominance of units priced between $400,000 and $800,000, constituting a significant 67% of unit sales. This preference for mid-range properties likely reflects considerations of affordability and lifestyle, making these units increasingly appealing to owner-occupiers and investors.
Houses Priced Between $400,000 and $800,000 Lead the Way
The market's trajectory is also being steered by houses priced between $400,000 and $800,000, representing 52% of house sales.
The popularity of this bracket suggests a sweet spot that balances value and quality, making it an attractive choice for a diverse range of buyers.
Home Values and Quartile Insights
As of July 2023, the Central West experienced year-on-year declines in home values, with houses witnessing a 7.4% dip and units facing a more substantial 8.4% decrease.
Notably, the upper quartile of houses endured the most significant value decrease at 9.8%, while units in the same quartile saw a surprising 16.9% decrease.
This dynamic shift presents an enticing opportunity for potential buyers eyeing premium house properties at more competitive prices.
On the flip side, the lower quartile tells a different story.
- For houses, the lower quartile’s value increased by 1.3%.
- For units, the lower quartile's value declined by 5.1%, signalling a persistent demand for affordable housing options.
This trend caters to both aspiring homeowners and savvy investors seeking entry-level properties.
Vendor Discounting and Time on Market
The market's negotiation landscape is evident in vendor discounting percentages and time spent on the market. In the house segment, the average vendor discount hovers at -4.4%, indicating buyers wielding negotiation power.
However, the average time on the market has expanded to 63 days from the previous 41, suggesting a more cautious approach from buyers.
CoreLogic
A parallel pattern emerges for units, where vendor discounting stands at -3.4%, with an average time on the market of 55 days. Although there has been improvement in discounting compared to the previous year, the extended time on the market (up from 34 days last year) indicates that buyers are taking a more deliberative approach to their property evaluations.
Market Predictions and Implications
To navigate the Central West real estate landscape successfully, one must consider many factors. Economic conditions and interest rate fluctuations continue to influence affordability, impacting prospective homeowners and investors. Sustainable and energy-efficient properties have gained traction, appealing to environmentally-conscious buyers.
Market stabilisation may lead to more realistic pricing expectations and reduced vendor discounting. The ongoing demand for mid-range properties is poised to shape the development landscape, prompting developers to cater to this particular market segment.
However, external factors remain unpredictable. Global economic shifts and unforeseen events can sway the market's trajectory, underlining the importance of informed decision-making.
Conclusion
The Central West real estate market in October 2023 is a dynamic environment characterised by evolving trends. The decline in sales, variations in home values across quartiles and shifting negotiation dynamics underscore the complexity of the current landscape.
For prospective owner-occupiers, mid-priced units and houses offer a harmonious blend of affordability and quality. Meanwhile, investors can explore premium properties that have decreased in value, potentially making them more accessible.
As the journey through the Central West real estate market continues, the key takeaway is the significance of staying informed and adaptable. Understanding these market dynamics empowers both homeowners and investors to make well-informed decisions aligning with their objectives and preferences in this ever-evolving market.
This article is intended to provide general information of an educational nature only. Information in this article is current as at the date of publication.
