 |
|||
|
|||
 |
|
 "The property market tide is in ebb (or is it flow??). With so many opinions, who knows?." - Mark |
| Rich shall save poor from property crash |
| By Teresa Ooi, Maurice Dunlevy and Anthony Clan |
|
June 12, 2004 IN the nation's most exclusive suburbs, talk of a property crash is almost cause for ridicule. In defiance of the hand-wringing and soul-searching within the ailing inner-city market, the turnover of multi-million-dollar properties in the capital cities continues to run red hot. Consequently, analysts and property industry watchers are increasingly optimistic that the latest property downturn will end in a soft landing, rather than a crash. If you want evidence of the strong market, Sydney real estate kingpin Bill Malouf's record of selling $62 million of luxury homes in the past six weeks should help convince you. "There's serious money out there -- the market at the top end is very, very strong," says Malouf, of L.J. Hooker. "It's a rock solid market with all local buyers, mostly from the eastern suburbs." He believes the underlying strength has been driven by wealthy empty-nesters selling waterfront homes to move to large, contemporary apartments in Sydney's well-heeled eastern suburbs. Most buyers of big family homes are cashed-up financiers with a young family who are looking to upgrade to a posh suburb closer to their children's private schools. They are prepared to pay for water views, space and security. Rowen Kelly, president of the Real Estate Institute of NSW, agrees that the luxury market is doing well, with a spate of sales in the $3 million to $10 million bracket, and the mood is being replicated in the other capitals. For Gerald Delaney, Melbourne real estate agent to the rich and famous, the market is on par with the 1980s, and in real estate parlance, that's about as good as it gets. "There's nothing wrong with this market -- we're enjoying some of the best times since the 80s," says Delaney, managing director of South Yarra-based realty firm Kay & Burton, and the agent behind Melbourne's 2002 record $15 million house sale to Toll Holdings magnate Paul Little. Whatever the gyrations of the wider housing market, Delaney says, sales in blue-blood suburbs are booming. This week, he sold a lavishly appointed, seven-year-old house in Toorak's exclusive St Georges Rd for $5.6 million. Last weekend, Kay & Burton sold six of eight homes offered at auction, with two selling for more than $2 million each, and three having a combined sale price of $7.5 million. "The figures speak for themselves," he says. "At the very upper end of the Melbourne market, we are seeing terrific demand." Stock shortages meant volume was down, but his agency was on track to sell more million-dollar properties in the first half of this year than it did in the first and second halves of 2003. Anything "waterfront" remains in demand. When Mirvac recently released almost 100 waterfront homes at its $750 million Beacon Cove development in Port Melbourne, it sold more than $70 million of property within hours. The smaller luxury home market in Queensland is harder to gauge. Landmark White's John McEvoy says very few houses over $2 million have been sold in the past three months. "That needn't be because of lack of demand -- it could also be lack of supply -- and I haven't seen any advertised," he says. "I don't anticipate that the market would be softening." Strong Australian business conditions -- corporate profits are at record levels and the economy, despite housing market wobbles, is storming along -- are holding up the top-end of the property market and giving hope to optimists who believe the housing market can avoid an all-out crash. Robert Mellor, director of building at economic forecaster BIS Shrapnel, says previous property crashes have been broader based, with all sectors of the market in retreat. Crucially, that's not happening this time around. "In the last recession, the top end of the market felt the cold winds first," he says. "It's not so now. The luxury market would only feel it if business slumps and there's extremely high interest rates. Then there would be significant price falls." He remains positive about the short-term market but is cautious for the future. "The property market is heading for a soft landing in the next six to 12 months," he says. "The tougher period would happen in a couple of years, when you have higher interest rates."
Reference: The
Weekend Australian. |
