June 2022 Market Report

A cold and wet start to Winter and a dampening of consumer confidence. Let me start out by saying I believe the Hunter region will not see the same declines that the capital cities will have in prices. We will be propped up to some degree by 4 streams;

A continuing regional migration for lifestyle & affordability spurred on from greater flexible working patterns,

First home buyer incentives including the stamp duty reform (read here)

Return of investors who will see better buying opportunity and the increased rental values

Owner occupiers selling and buying instead of renovating (see my full article on this here)

Of course the region will not be immune. Simply just looking at the supply and demand equation locally, we can see that since March, more homes have been listed for sale (blue line) than sales being made (orange line), and that gap it is widening. The below chart is a snapshot of the West/North West Lake Macquarie corridor from postcode 2283, 2284, 2267 but is representative of all the other market segments as well. You can send me a message if you would like details on a specific area.

If you are a data nerd, there are some interesting patterns of housing markets discussed in this AFR article. A recent analysis by Domain that observed the duration of market cycles in Sydney, found that the downturns tended to last less than half the amount of time (in months) than the preceding upswing. “The downturns are shorter and less severe than what was seen in the upswing, generally speaking,” says Dr Nicola Powell, Domain Chief Economist

For example, the property boom between 2000 and 2004 lasted 42 months until reaching its peak, whereas during the downturn that followed, it took just 18 months for prices to fall from the peak to the next trough.

Given the region has recorded more than 30% price growth in 2021 alone, property will still end up much further ahead than it was in the last downturn of 2018/19. In the space of 4 years we have gone from the worst to the best, and ready to start a new cycle again.

If you have any property related questions, please reach out ?