Sales Trends: Houses and Units
In May 2023, the New England region witnessed a significant 29% year-on-year decline in dwelling sales, affecting both houses and units.
House sales experienced a 29% drop, while unit sales saw a decline of 25%. These figures are indicative of a market in the midst of significant shifts in demand and evolving consumer behaviours.
Preference for Mid-Range Units
The market is largely dominated by units priced between $200,000 and $400,000, constituting a substantial 61% of unit sales.
This strong preference for low to mid range properties reflects considerations of affordability and lifestyle, making these mid-priced units an appealing prospect for both homeowners and investors.
Balanced Demand for Houses Priced Between $200,000 and $600,000
Driving the market are houses priced between $200,000 and $600,000, accounting for 65% of house sales.
The popularity of this bracket underscores the balance between value and quality, making it an attractive choice for a diverse range of buyers.
Bigger Increases in Value for Lower Priced Homes
As of July 2023, New England's home values experienced year-on-year increases, with houses witnessing a commendable growth of 1.6%.
Notably, within the housing sector, the increase in value was more pronounced in the lower quartile, with the upper quartile seeing a modest 0.2% increase for houses and a substantial 5% increase for the lower quartile. This upward trend represents a potential opportunity for sellers seeking a return on investment.
Vendor Discounting and Time on Market
The negotiation dynamics in the market become apparent when examining vendor discounting percentages and the time properties spend on the market.
In the case of houses, the average vendor discount stands at -4%, signalling a degree of negotiation power wielded by buyers.
However, it's worth noting that the average time on the market has slightly increased to 58 days from the previous year's 44, suggesting a more prudent approach from buyers.
CoreLogic
Market Predictions and Implications
Effectively navigating the New England real estate market necessitates consideration of a multitude of factors.
Economic conditions and fluctuations in interest rates continue to impact affordability, influencing both prospective homeowners and investors. The allure of sustainable and energy-efficient properties has grown, appealing to environmentally-conscious buyers.
The market's potential stabilisation may lead to more realistic pricing expectations and reduced vendor discounting. The sustained demand for lower-priced properties is expected to shape the development landscape, prompting developers to cater to this market segment.
However, it's crucial to acknowledge that external factors remain unpredictable. Global economic shifts and unforeseen events can influence the market's trajectory, underscoring the importance of making informed decisions.
The New England real estate landscape in October 2023 mirrors a dynamic market marked by evolving trends. The decline in sales, variations in home values across quartiles and the dynamics of negotiation highlight the intricacy of the current environment.
For aspiring owner-occupiers, mid-priced units and houses offer a harmonious blend of affordability and quality. On the other hand, investors can explore premium properties that have decreased in value, potentially making them more accessible.
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.
