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Treak Real Estate Property Update: October

Welcome to this month’s Treak Real Estate Property Update: news from the Sydney and national property markets, as well as what’s been going on here at Treak!


Spring: a season of change in more ways than one...


The last month has been an eventful one for the market, with the COVID-19 situation continuing to develop, the Federal Budget being handed down, and the NSW government extending the moratorium on evictions.


It’s also been an exciting one at Treak: our Real Estate For Good program has gone from strength to strength, and we’ve recently introduced a new (and completely transparent) pricing structure, which you can check out here!


In keeping with our mission of social responsibility and generally doing the right thing, we have made our rates entirely transparent and fair: you can be confident that there are no hidden fees, and each of our value-rich packages will be delivered as advertised!


Real Estate For Good: Long Walk Home


In the real estate industry we’re so busy matching buyers and renters with their dream homes that we can forget that many people don’t have a place to call home at all. Our Real Estate For Good program aims to address the imbalance: we donate a portion of all sales commissions and letting fees to charities that help Sydneysiders in need.


But we can’t just talk the talk; we also need to walk the walk... which is exactly what we’ll be doing on Sunday the 1st of November.


On that (hopefully sunny) day, the Treak team will be walking 28km as part of the Long Walk Home, an event that aims to raise funds for Sydney’s homeless. Why 28km? That’s how far a person experiencing homelessness walks in a week on average: to find help, shelter, or simply a safe place to rest.


Every dollar we raise will be passed onto Wayside Chapel, who offer love, care and assistance to the most vulnerable people in our community. If you would like to sponsor us in our efforts to support people living on our streets, you can do so by clicking here. Any donation is super appreciated (and tax deductible!)


Budget business


Delivered on the 6th of October, this year’s Federal Budget doesn’t directly impact the property market to a great degree, although there are some key highlights:

  • First-home buyer incentives: An extra 10,000 places were made available in the Federal Government’s First Home Loan Deposit Scheme, which sees 15% of a loan guaranteed, removing the need for LMI. These places are restricted to new home builds, so unfortunately apartment developers lose out.

  • $1 billion for affordable housing: To support construction, made available via the National Housing Finance and Investment Corporation.

  • Indigenous home buying assistance: Indigenous Business Australia’s Indigenous Home Ownership Program receives $150 million to deliver 360 construction loans, helping Indigenous Australians into the property market.


Giving Sydney tenants security in a time of need


In late-September the NSW government announced a six-month extension on its moratorium on evictions, which prevents landlords from evicting COVID-19 affected tenants for rental arrears “unless they have attempted to negotiate a rent reduction in good faith.”


Other measures have also been extended, including allowing tenants to end fixed term agreements under certain circumstances, and requiring landlords to give a 90-day minimum period of notice for non-arrears-related evictions.


TREAK MARKET UPDATE


What has the property market been up to recently? Read on to find out!


National and Sydney market changes


While property market demand is still very much there, many sellers have taken pause, waiting for a time when they can be more confident of obtaining a decent price. The result? With low supply but steady demand, the properties being put up for sale are often snapped up quickly, and for a surprisingly good price.


In fact the market’s low housing stock, along with record-low interest rates and governmental stimulus measures, has kept Australia's property market quite resolute, and performing better than initially feared. Home values are still falling slightly, but not as quickly as they were mid-year.


Interest rates


RBA cash rate: 0.25%


While expectation grows that interest rates could fall further, the RBA chose to hold firm at 0.25% this month. Keeping the rate so low has been key to ensuring financial market liquidity, supporting real estate market activity, and protecting home values.


While property values are down 2.1% nationally from their April peak, more recent trends show the market is stabilising, and according to Core Logic home sales over the September quarter are tracking slightly higher than a year ago, despite the aforementioned low housing stock.


Auction clearance rates


Sydney auction clearance rate: 73.1%


As reported by Core Logic, Sydney’s auction clearance rate for October was 73.1%, slightly above the weighted national average of 71.5%, which, although slightly down on respective figures of 76.9% and 73.5% from this time last year, is still a strong result given the ongoing uncertainty.


12 Sydney auctions were held for every one Melbourne auction, with the Victorian capital still in the midst of a strict lockdown (though restrictions began easing in mid- to late-October.) But the Sydney auction market was far more dynamic than even areas unaffected by COVID, with the city accounting for almost three-quarters of recent auction activity nationally.


Vacancy rates


Inner-Sydney vacancy rate: 5.5%


The Real Estate Institute of NSW (REINSW) vacancy rate survey showed that rental vacancies for Sydney’s inner ring rose 0.8% from August to 5.5% in September - more than double the vacancy rate from the same time last year.


“Property managers are telling us that there are fewer properties coming onto the market and those that do are taking longer to rent” said REINSW CEO Tim McKibbin. “Older properties in need of upgrading are particularly problematic, as tenants become more picky about where they choose to live.


“Feedback from our members in regional areas indicates that the exodus of tenants from Sydney is continuing, with people seeking out more affordable options further afield from the main metropolitan hubs.”


And that’s it from us for the month of October! Thanks for reading, you can subscribe for future property market updates here and be sure to forward our newsletter onto any interested friends!


Until next time,


Renae Treak


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