A look back on how the market performed in 2011

The real estate mar­ket will be draw­ing a sigh of relief as the year comes to an end.

As we take a look back on how the mar­ket went in 2011, we saw an over­all improve­ment of up to 10 4/18 Magowar Road Pendle Hill% — a heavy drop for the real estate mar­ket but a small part of the share­market cor­rec­tion of 2008.

As we peek into the crys­tal ball and think what 2012 wait­ing for home own­ers and real estate investors, there are a few sig­nals that pro­pose we are enter­ing calmer surf.

With Europe in scan­dal and crisis, the USA eco­nomy frail and China slow­ing, interest rates are on a down­ward spiral. Experts anti­cip­ate the Reserve Bank od aus­trila will cut rates down con­tinu­ally over 2012. There could be a reduc­tion of up to 100 basis points through­out 2012.

Fall­ing interest rates imme­di­ately increase afford­ab­il­ity and attract buy­ers back to the real estate mar­ket. Home buy­ers jumped in with both feet in 2001 and 2009 largely due to drop­ping interest rates. The main change in 2013 mar­ket prob­ably won’t come with increased first home buyer grants.

Real estate is a great Aus­tralian pas­time and this goes on to be the case.

Web data shows that, des­pite com­pet­i­tion for prop­erty was low in 2011, web brows­ing endures to be very high. Online data ana­lysis of real estate web­sites pro­poses more than 3 mil­lion Aus­trali­ans look for real estate each month. That would mean around 15 per cent of the pop­u­la­tion is pro­act­ively look­ing at real estate at any onetime.

This very high activ­ity flows on to the phys­ical mar­ket, with many real estate agents see­ing high num­bers of buy­ers at inspec­tions for qual­ity homes. Even though the level of interest are many people, that believe 2011 has not been the ideal time to buy.

First home buy­ers and investors have sat on the fence of the prop­erty mar­ket. The con­sequence is a major increased demand for rental real estate and a lower­ing of sup­ply of leas­ing prop­er­ties. As a fal­lout, we are will see rental yields lift in 2013.

Accord­ing to the Reserve Bank of Aus­tralia, house­hold sav­ings are at their highest levels since the 1980s. They have been creep­ing up since the middle –2000s, hit­ting the top at 10.5% of dis­pos­able income in the June quarter.

Many mort­gage have been mak­ing sub­stan­tial extra prin­cipal repay­ments in the last couple of years and this will add to their equity and cash flow positions.

For many buy­ers, as money begins to burn a hole in our pock­ets. People who have been avid savers and have a stable job — which is 95% of the pop­u­la­tion — will start to fig­ure out it’s not the end of the world and will begin to buy again.

The real estate mar­ket is cyc­lical and often the biggest period of growth comes straight after the biggest drops.

I think when we all look back into 2012 in years later these factors will likely res­ult in a rebound in median prop­erty val­ues, and the mar­ket will come full circle back to where we star­ted before 2011 drop.


Jhai is an award win­ning Inter­net Mar­ket­ing Real Estate Agent for Eld­ers Toongab­bie and Kings Langley. After run­ning his own inter­net mar­ket­ing busi­ness he has now set his own sites for the real estate industry. He observed that 90% of real estate agents did not know how to mar­ket them­selves online. Jhai is now fixed on one goal. To teach real estate agents that they can mar­ket online so much bet­ter than they cur­rently are.

Since then he has been con­sist­ently quoted in the Sydney Morn­ing Her­ald and Real Estate Busi­ness online. He is a reg­u­lar guest blog­ger on TheHomePage.com.au, shar­ing his expert­ise of mar­ket­ing aspects for the Real Estate Industry. His biggest pas­sions are his wife, mar­tial arts, dogs and most of all property.

seven hills real estate agent NSW
Cnr Federal Road Prospect Highway Seven Hills NSW 2147 Australia