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Speaker 1: Welcome to the Property Pendulum, brought to you by Domain

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Speaker 1: and Fear and Greed, the podcast that tells you which

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Speaker 1: way the property market is going to swing and how

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Speaker 1: to make the most of it. I'm Michael Thompson and

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Speaker 1: I'm joined every week by Alice Staltz, national Property editor

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Speaker 1: at Domain, one of Australia's foremost experts on all things

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Speaker 1: real estate, of course known to audiences right around the

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Speaker 1: country because of her work on nine including the Block,

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Speaker 1: You have been very busy. Hello Alice, Hello Michael. Alice.

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Speaker 1: Spring selling season in fact, twenty twenty four in its

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Speaker 1: entirety is racing to a close, which might sound very dramatic,

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Speaker 1: really doesn't it. But it's been a pretty unusual year,

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Speaker 1: hasn't it for house prices. It's been less less of

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Speaker 1: a two speed market and more like a three or

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Speaker 1: four speed market, with some cities booming, some just cruising,

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Speaker 1: and others actually kind of falling backwards a bit, and

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Speaker 1: all of that has had an impact on buyers, on

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Speaker 1: sellers and what's happening every Saturday at open for inspections

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Speaker 1: and at auctions. So today we are going to delve

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Speaker 1: into this in a little bit more detail. We have

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Speaker 1: a special guest joining us today. Alice Ewan Morton is

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Speaker 1: the joint managing director of Morton Real Estate, a Sydney

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Speaker 1: based agent who it must be said, has his ear

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Speaker 1: to the ground right around the country. You and welcome

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Speaker 1: to the Property Pendulum.

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Speaker 2: Thank you for having me, are we?

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Speaker 1: I know I started very dramatically with this whole racing

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Speaker 1: to the end of the year. But are we finishing

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Speaker 1: twenty twenty four with a bang or are we just

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Speaker 1: kind of limping towards the finish line.

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Speaker 2: Well, that's a very good question because we're always asking

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Speaker 2: the question are we going to run up to Christmas?

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Speaker 2: So does everyone pack up and go home or do

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Speaker 2: we go hard? And my feeling at the moment is

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Speaker 2: I think that we might be running up until Christmas.

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Speaker 2: The reason for that is probably more that we have

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Speaker 2: vendors that want to get things sold, and there probably

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Speaker 2: has been well there has been a pullback in buyer activity,

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Speaker 2: so that's the interesting bit to it. Normally it's the

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Speaker 2: other way around, where buyers want to get done by

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Speaker 2: Christmas and that will all they'll pack up and go

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Speaker 2: home because it's all been too exhausting. So I think

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Speaker 2: that there's definitely still deals to be done out there

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Speaker 2: and bendors who have a preference to sell, And that's

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Speaker 2: probably the key message for buyers is there are bendors

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Speaker 2: out there with a very very strong preference to sell.

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Speaker 3: I think also, Michael, it's important to be mindful of

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Speaker 3: the fact that, you know, we started this year anticipating

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Speaker 3: this mortgage cliff that kind of didn't eventuate in the

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Speaker 3: way that people expected it to. House prices rose in

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Speaker 3: a way that people didn't anticipate. However, obviously buyers have

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Speaker 3: felt more constrained than ever, so we had all these

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Speaker 3: things play out. That's left people sort of getting to

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Speaker 3: this point towards end of the year thinking, oh my god,

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Speaker 3: how to actually get here? And my plan's gone completely

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Speaker 3: skew with and what I wanted to do hasn't been

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Speaker 3: able to happen for a variety of reasons. So some

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Speaker 3: people are kind of going hard to get things done

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Speaker 3: before the year end, and I think we are definitely

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Speaker 3: seeing others hold back, thinking I'm going to put this

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Speaker 3: off to next year when there's hopefully more clarity and stability.

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Speaker 1: Can I ask you, then, based on kind of what

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Speaker 1: Alice has just said, then as well. A lot of

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Speaker 1: things took us a bit by surprise this year, just

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Speaker 1: things not necessarily going the way we expected. What then,

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Speaker 1: what a buyer is wanting? What are they actually looking for?

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Speaker 1: Is there an ideal property that that is really kind

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Speaker 1: of in demand at the moment?

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Speaker 2: Would necessary say there's an ideal property or bobbily an

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Speaker 2: ideal property? Then is vendor who wants to sell it? Yeah?

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Speaker 2: So you know, interesting listening to what Alice was saying there,

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Speaker 2: because you had bizarre things happen. We had interest rates

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Speaker 2: rocket right up, but the market rocketed right up, and

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Speaker 2: everyone was expecting it to go the other way. I

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Speaker 2: actually think what's happening now is those hi you just

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Speaker 2: rate to starting to hit, so everyone's calmed down a

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Speaker 2: little bit. And also you've got a lot of vendors

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Speaker 2: who jumped into the market wanting to take advantage of

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Speaker 2: that peak, and what often happens is they're a bit

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Speaker 2: too late to the party. And that's really what we're

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Speaker 2: facing at the moment where days on market are sort

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Speaker 2: of starting to extend out, and so buyers a feeling

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Speaker 2: that they have more to choose from, and they're very

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Speaker 2: much considering what their mortgage repayments are going to be

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Speaker 2: and that's giving them a level of conservatism that's making

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Speaker 2: them pull back. So you know, I think now we're

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Speaker 2: starting to see the effect of those interest rates on

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Speaker 2: the market, is my take on it.

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Speaker 3: I think also what's playing out in terms of property

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Speaker 3: types that are doing well. I think definitely the turnkey

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Speaker 3: property continues to be quite strong in market because those

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Speaker 3: who want to buy are sort of the ones who

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Speaker 3: probably are erring on the side of wanting things short up.

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Speaker 3: I think the issue is obviously a property that needs

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Speaker 3: to be renovated. We've got massive planning changes taking place,

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Speaker 3: particularly in Sydney, Melbourne, Brisbane. At the moment, we've also

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Speaker 3: still got that increased cost in renovating and delays and

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Speaker 3: the uncertainty about what's ahead. I think, you know, just

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Speaker 3: after the back of the US election, is uncertainty about

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Speaker 3: the future of the economy. So I think people are

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Speaker 3: really quite spooked off renovated's delights at the moment, and

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Speaker 3: definitely in the Victorian market and particularly parts of the

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Speaker 3: Sydney market in particular, we are seeing stock that is

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Speaker 3: well renovated being easier to sell than the ones that

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Speaker 3: do require a bit of TLC or a bit of

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Speaker 3: an action plan that's going to take a few years

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Speaker 3: to come to fruition, and I think that's where the

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Speaker 3: good buying is at the moment. But a lot of

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Speaker 3: people are really under the pressure of not being able

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Speaker 3: to borrow that money, so they're the ones that are

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Speaker 3: particularly holding back.

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Speaker 1: Does that match up with what you're seeing?

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Speaker 2: You in one percent? So you can still get good

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Speaker 2: prices like this. This is the other twist to it,

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Speaker 2: is that you can still get a good price on

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Speaker 2: a property, but it depends on what that property is.

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Speaker 2: So like what Alice was saying about the turnkey properties,

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Speaker 2: definitely they can be well competed, but I think the

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Speaker 2: key is how you price it. So a lot of it.

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Speaker 2: We just had our sales meeting this morning and my

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Speaker 2: message to the team was, I think that we're ten

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Speaker 2: percent down on expectation. I'm not sure if that's down

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Speaker 2: on actual prices that would play out over the next

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Speaker 2: little while, but definitely you've got vendors that have got

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Speaker 2: expectations or hoping for numbers that aren't there. So we've

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Speaker 2: got to pull those expectations back. And if you're selling

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Speaker 2: something you almost need to go with, you know, very

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Speaker 2: much with comparable sales, and then also look at well,

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Speaker 2: particularly we are in a declining market, if you're priced

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Speaker 2: too high, with the number of buyers that are out

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Speaker 2: there which is dropping, they just want to look at it.

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Speaker 2: So you have to be very careful about how you

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Speaker 2: execute your campaign if you want to get a good result.

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Speaker 3: Yeah. I think we've definitely seen instances where some people

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Speaker 3: are living like it's twenty twenty two, and I think

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Speaker 3: and their expectation is that they're being bullish and what

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Speaker 3: they think prices will do. Whereas forecasting for now and

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Speaker 3: again that can obviously change, it is actually quite moderate

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Speaker 3: in terms of forecasting even for the year ahead. Knowing

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Speaker 3: that we have seen such an explosion of house prices

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Speaker 3: over the past decade, we are apparently now going to

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Speaker 3: enter a period of just a bit more sort of

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Speaker 3: a slower ebb and flow of price rises.

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Speaker 2: Yeah, and that's not necessarily a bad thing for transactions,

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Speaker 2: because people can feel confident they can go out into

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Speaker 2: the market sell what they've got by what they need.

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Speaker 2: Whereas when it's really hot, it's very difficult that people

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Speaker 2: get very fearful of being actually locked out, So you know,

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Speaker 2: it could be. I mean, from a transaction point of

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Speaker 2: view as an agent, this year's been fine. Things are solid.

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Speaker 2: Like I would have said, we've had a consistent year,

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Speaker 2: which is a bizarre thing to say in real estate sales,

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Speaker 2: but it definitely. You know, we had a strong month

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Speaker 2: last month. This month's looking solid. I think we're going

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Speaker 2: to go up to Christmas. So from that point of view,

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Speaker 2: it's good. But we have got more stock than we

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Speaker 2: would normally hold it this time, and I think that

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Speaker 2: is because vendors are trying to jump in and for

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Speaker 2: some of those vendors, it's not an easy path, particularly

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Speaker 2: when they have this strong preference to sell. So when

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Speaker 2: I say that, there's something else going on in the

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Speaker 2: background that's driving them to sell the property. So we're

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Speaker 2: seeing there is a little bit of pressure out there.

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Speaker 1: On the buyer side. Then who is actually buying at

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Speaker 1: the moment? Then is it upsizes, is it downsizes, Is

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Speaker 1: it first home buyers, or is it those who are

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Speaker 1: comfortable with where interest rates are at at the moment,

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Speaker 1: at these elevated levels and are more kind of financially

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Speaker 1: secure and sure of their position.

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Speaker 2: So it depends very much which marketplace you're in, so

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Speaker 2: we cover a lot of Sydney, so we have got

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Speaker 2: first homeowners out in areas like Penrith, and then closer

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Speaker 2: into the city it's more owner occupied. Definitely a lot

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Speaker 2: more owner occupies and probably the people who don't need

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Speaker 2: a mortgage, so they tend to be wealthier and probably

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Speaker 2: can afford to take their time, and particularly at the

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Speaker 2: upper end, you know, people don't necessarily need those properties,

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Speaker 2: so they tend to see a little bit more variance

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Speaker 2: in terms of price. So as you know this sort

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Speaker 2: of market plays out, you know, people become more conservative

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Speaker 2: and if you're conservative and you've got the cat, well

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Speaker 2: you're sort of sitting in a pretty strong position. I think.

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Speaker 3: Also it's important to remember and it's sort of a

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Speaker 3: hard one to remember for most people, but there are

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Speaker 3: still a lot of people who aren't playing in that

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Speaker 3: mortgage space, so they're the ones that aren't impacted by

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Speaker 3: interest rates. So definitely, I think anyone upgrading the seems

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Speaker 3: to be enjoying things a bit more. I suppose definitely

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Speaker 3: what we're seeing though in Victoria due to taxation changes.

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Speaker 3: When I say that, I mean the increase in land tax,

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Speaker 3: airbnb levies et cetera. Is that sort of stock being

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Speaker 3: sold off. So the market in Victoria particularly is flooded

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Speaker 3: with pretty, you know, b gratish investor style stock. What

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Speaker 3: you are also seeing though, is opportunistic buyers coming in

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Speaker 3: kind of getting bargains there knowing what prices are expected

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Speaker 3: to in Melbourne over the next five years or so.

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Speaker 3: So we are definitely seeing a really big dump of

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Speaker 3: investor stock in Victoria and those buyers are definitely heading

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Speaker 3: to Sydney and to Brisbane in particular.

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Speaker 2: Interesting, very interesting that comment, because across Sydney, I'd say

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Speaker 2: one of the things that's absent from our marketplace is

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Speaker 2: the investor. So we would have at one time sold

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Speaker 2: half to occupy us half to investors, whereas now I'd

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Speaker 2: say we're probably fifteen percent investor. And some of those

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Speaker 2: investors actually they're buying it to use later, so they're

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Speaker 2: a delayed owner occupier, if that makes sense, and a

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Speaker 2: lot of investors. Because what's happened is the rents have

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Speaker 2: gone up a lot, there's no doubt about that, but

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Speaker 2: mortgage rates have gone up even more so with the

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Speaker 2: flattening of the market or in summers like some of

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Speaker 2: that stoff that you were just talking about alistairs areas

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Speaker 2: of Sydney where people have say, bought off the plan

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Speaker 2: and they haven't got their money back yet. So it

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Speaker 2: definitely is at two speed. Like there's some places that

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Speaker 2: are suffering, and so what those landlords are doing is

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Speaker 2: like why am I funding this thing? So everyone complaining

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Speaker 2: about negative gearing, Well it seems to be working that

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Speaker 2: land boards are exiting it, and I think that's a worry.

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Speaker 2: I'm concerned about that because you need to have those

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Speaker 2: investors in order to be able to help with housing supply.

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Speaker 3: Yeah, the investor market's really intriguing one to watch. And

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Speaker 3: I think first or not that we're still an incredibly

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Speaker 3: low vacancy rates all around the country at the moments

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Speaker 3: that the tenants are finding it very very hard. People

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Speaker 3: are trying to imply that they're supposed to sort of

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Speaker 3: be relieved that rents aren't going up as much as

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Speaker 3: they were, which is true. However they're still at record highs.

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Speaker 3: I think also we're seeing you know, investors particularly priced

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Speaker 3: out of that Sydney market, you know Sydney. The Sydney

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Speaker 3: Meeting hit a new price high this year. So affordability

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Speaker 3: is definitely impacting the market there and we are seeing

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Speaker 3: that sort of growth definitely pick up in Brisbane. But

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Speaker 3: you know that Brisbane market is almost on parity with

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Speaker 3: the Melbourne market now. So even for investors, the prices

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Speaker 3: have just got so much higher in Australia, particularly in

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Speaker 3: those cities over the past year, that it's tough. It's

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Speaker 3: tough for them as well.

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Speaker 1: Right you, and we are running out of time, So

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Speaker 1: I want to ask you really it's a kind of

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Speaker 1: a two part question here. So you've kind of said

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Speaker 1: really that that vendors wanting to get things sold, there's

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Speaker 1: a bit of softer demand really kind of broadly from buyers.

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Speaker 1: What is your message to buyers then, who are considering

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Speaker 1: their next move, how do they best position themselves to

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Speaker 1: get a good deal as we run up to Christmas?

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Speaker 1: And then the flip side you might have guessed it

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Speaker 1: is going to be from the seller's side, from the

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Speaker 1: vendor side, how they make the most of the conditions

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Speaker 1: that we're in at the moment.

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Speaker 2: Okay, so if you're a buyer, buy it.

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Speaker 1: The most stratefulard advice I think I've ever heard.

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Speaker 2: I've said this, like, you know, could you talk to

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Speaker 2: yes Do you like the property, Yes, I do. Does

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Speaker 2: it suit yes it is. Have you seen lots of stuff,

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Speaker 2: yes I have. You've been in the market for a

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Speaker 2: long time, yes I have. All of that is that

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Speaker 2: we'll then buy it. And I think that when market,

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Speaker 2: when it pulls back a bit, buyers get very conservative

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Speaker 2: and they get anxious about that, and they sort of

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Speaker 2: start to tack their time, whereas I'm a bit like,

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Speaker 2: if it's what suits you, if it fits your needs

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Speaker 2: at what you're trying to achieve. Generally, buying a property

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Speaker 2: has a housing need behind it. Sword So if you've

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Speaker 2: been out there, you know what you're doing, You've done

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Speaker 2: your research, you see the thing, it's what you like,

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Speaker 2: will buy it, and you've probably got an opportunity to

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Speaker 2: buy relatively well at this point in relation to the

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Speaker 2: extremes that we've seen. So buy it. And what happens

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Speaker 2: is that buyers pull back. We'll back, we'll back, and

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Speaker 2: for some reason, they all seem to make a collective

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Speaker 2: decision on the one weekend to move forward and buy,

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Speaker 2: and suddenly you're in competition again. So for buyers, take

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Speaker 2: confidence in what you're doing, and take confidence in what

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Speaker 2: you know, and get on with it. From a vendor

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Speaker 2: point of view, really think hard about why you're selling

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Speaker 2: the property and what you're trying to achieve. So I

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Speaker 2: spend a time saying to having conversation dron what is

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Speaker 2: your goal and at what price can you still achieve

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Speaker 2: your goal because sometimes if you're selling for less, you

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Speaker 2: could be buying for less, So it's about changeover. You

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Speaker 2: might be, you know, putting money into an investment and

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Speaker 2: you know you knock a little bit back on your property,

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Speaker 2: but you can still move forward with the investment that

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Speaker 2: you're doing, so you know you very much be clear

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Speaker 2: about why you're doing it. That's the first thing. And

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Speaker 2: the second thing is price yourself to the market as

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Speaker 2: to where the buyers will find it attractive and breed

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Speaker 2: the competition. The competition is what will push it up

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Speaker 2: and gives you the best chance of getting the price.

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Speaker 2: But you have to trust in that, and of course

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Speaker 2: human nature, being as it is, a lot of vendors

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Speaker 2: find that really really difficult. So what happens is they

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Speaker 2: go at a really high price thinking that someone's going

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Speaker 2: to come forward and make them an offer, but they don't.

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Speaker 2: So you have to navigate it. And I always say

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Speaker 2: to vendors, we don't sell property as agents you do

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Speaker 2: because you only sell it when you sign the contract.

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Speaker 2: So don't get too overbaked about the whole price and thing,

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Speaker 2: and just listen to what your agent is telling you basically,

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Speaker 2: and that's what we're will achieve you the best result

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Speaker 2: in this market, and if you do it right, you

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Speaker 2: can still get a good price.

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Speaker 1: Thank you for joining the property pendulum today. Some great advice,

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Speaker 1: I hope.

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Speaker 2: So there you've got a bit of a true opinion there,

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Speaker 2: So I hope you that's helpful to the people who

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Speaker 2: are listening to this.

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Speaker 1: It certainly is. That was you and Morton Joint managing

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Speaker 1: director at leading independent agency Morton real Estate, Alice plenty

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Speaker 1: to consider there, don't you reckon?

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Speaker 3: Yeah, there's a lot there. I think one of the

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Speaker 3: things that you were touched on, which I think is

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Speaker 3: so true, is that we are in this and these

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Speaker 3: are my words and you put them into you In's

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Speaker 3: mouth about being a dull market, but he will sort

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Speaker 3: of talking about it being more sort of, you know,

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Speaker 3: a constant, stable market, and I think that's completely true.

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Speaker 3: And I think for years we've sort of lived in

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Speaker 3: this complete supersonic market which has been turbo charged NonStop,

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Speaker 3: and that is not sustainable and it doesn't really help everybody.

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Speaker 3: And I think we're moving into this sort of more

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Speaker 3: egalitarian market, I suppose, and it's a bit more sort

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Speaker 3: of fair error market, and I think there's less hate

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Speaker 3: in it. This is a really good thing. It might

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Speaker 3: just seem a bit kind of less crazy and not

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Speaker 3: making people stopping their tracks. That's not a bad thing.

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Speaker 3: So let's forget the sensational and actually think this is

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Speaker 3: a more sustainable market which will also really begin to

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Speaker 3: reshape how we approach the issue of affordability, I think

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Speaker 3: in the years to come.

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Speaker 1: Yeah, well said, Thanks very much, Alis, Thanks Michael. That

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Speaker 1: was realtate expert Alice Staltz, national Property editor at Domain,

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Speaker 1: and I'm Michael Thompson. Make sure you're following the podcast

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Speaker 1: and we'll be back next week with another episode of

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Speaker 1: The Property Pendulum, brought to you by Domain and Fear

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Speaker 1: and Greed, the podcast that tells you which way the

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Speaker 1: property market is going to swing and how to make

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Speaker 1: the most of