Buyer optimism blossoms despite our chilly winter

The strength of the Australian residential market continues to power ahead, registering value growth for the 16th successive month.

Home values increased 0.8% in May, which is the largest monthly gain since last October.

The mid-sized capitals are leading the way. The three hottest cities right now are Perth (+2% in May alone), Adelaide (1.8%) and Brisbane (+1.4%).  

According to CoreLogic's Home Value Index, these rises are the equivalent of more than $12,000 in each city. Meanwhile, Sydney rose 6% and Melbourne remained flat.

A driving factor for these price rises is the lack of supply – a continuing theme that has entered the political discourse. 

CoreLogic says the number of properties on the market in Perth and Adelaide remains 40% below five-year averages, while Brisbane is 34% below.

What's the takeaway here?

This data signals three crucial points. 

Firstly, buyer optimism remains strong across the country. Secondly, the consequence of demand outstripping supply remains consistent even in a high interest rate environment. If you need further evidence, the CoreLogic data finds Hobart has 41% more properties on the market than its five-year average and its sales values dropped -6.4% in May.

Finally, it should signal to owners thinking of selling that they should capitalise on the current conditions. 

The scuttlebutt around the immediate future of interest rates remains confused.

While most pundits expected rates to start falling, the Reserve Bank of Australia has hinted it might raise them beyond 4.35% to bring inflation within its 2%-3% target range.

Below, our agents offer five key pieces of advice for owners considering selling in the current market conditions. And if we can help you with your property needs, please do not hesitate to contact us:

• Do your research: Investigate the price trends in your area. Consider attending some auctions to gauge the market's mood in your suburb. 
• Talk to a trusted agent:  Tapping the wisdom of local market experts is essential. Ask us about the consistency of price trends for your type of home. How quickly are properties similar to yours selling? We are happy to provide a price appraisal.
• Equity and financial goals: Consider your financial goals and the impact selling would have on either downsizing or upgrading. Ask your lender how much equity you have in your loan and the size of any preapproved loan they would grant you. 
• Your next home: Obviously, you'll need somewhere to live. So, it's always important to consider the type of home you wish to purchase. Consider your future needs, whether they're related to a growing family, health or a desire for a different lifestyle.
• Be Realistic: It's easy to get carried away with how much you believe your home to be worth. But you need to be realistic. Rising markets often skew owners' perceptions of value. Price your home in line with current market values, and be prepared to negotiate if you want a quick sale.