The property market can become an emotional and financial roller coaster for all stakeholders including buyers, sellers, banks, agents and conveyancers. Using NSW for our ‘case study’, by early May 2019, the volume of property sales had fallen by 20 per cent over the past year to its lowest level since early 1996. Could it get any worse than this? Thankfully the answer was no. Here is what happened since:
- A Federal Election outcome welcomed by the ‘property market’
- Two interest rate cuts
- A reduction in the supply of properties listed for sale
- An upturn in auction clearance rates
- In Sydney and Melbourne, dwelling values stabilised and in many areas started to rise
- In June 2019 – the first uptick in dwelling sales volumes on a nationwide basis ending the previous downward cycle
One more month has passed and in July the nationwide uptick in property sales volumes continued.
The recent downturn was brutal. CoreLogic statistics show that sales volumes (settled sales) were down in July 2019 compared to one year earlier by 25.6% in Melbourne, 18.7% in Sydney, 14% in Brisbane and 17.4% for combined capitals.
Now that the worst is over, how much of a bounce can we expect in conveyancing over the next 12 months? In Sydney for example, 20% could be too optimistic because that would bring it to the top of the last boom in 2017.
The graph below depicts the volatility over the last few years by looking at the month of July from 2014 to 2019. It hints at what we might expect over the next 12 months.
Legal Practice Intelligence expects an increase in sales volumes in the range of 10% to 15% in NSW compared to last year. Nationwide, a 10% increase might be a reasonable expectation. That’s not bad for one year but what happens after that?