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It’s amazing how an election result can change people’s confidence in the real estate market. Weeks leading up to the election, enquiry had slowed considerably. Maybe more so this time as one of the major policies was going to have a direct impact on the market, being Labor’s push to have negative gearing and capital gains reform. The slowing of enquiry is a normal trend and having been in real estate for over 16 years, this pattern happens each and every election. However what’s happened since then is an increase in activity. I have read that enquiry for home loans in the week after the election result is up and buyer inspections have improved. Maybe it’s just timing with expectations on interest rates to reduce and other policy changes that will allow more relaxation on borrowing. Only time will tell on that.
What all this shows is that confidence is such a big thing when it comes to taking action. Interestingly there are some articles from some so called experts out in the media saying that markets have hit the bottom and that capital growth will soon return. I can only say to be very careful in believing this. Personally, I don’t think this is correct, based on supply and demand, business confidence, employment figures and seeing that the Reserve Bank has no option but to move interest rates to get inflation to the target it needs too be. There are just too many factors to prove this and while I am happy to be proven wrong, I doubt this will happen.
The reality is that there are markets within markets. You have a national market made up of big cities, then broken down to markets in different suburbs, markets within different regional areas, market’s within different property types, the list goes on. All have different driver’s that either make the market good, bad or otherwise.
One thing is for sure, I wouldn’t believe everything in the media. If the polls are anything to go by in the latest election, then you can’t believe anything the media puts out. Plus remember, they are there to sell papers and get clicks online, whether the information is credible or not. So if you want to know what’s really happening on the ground, talk to the people in the industry, the people that are living and breathing the trends. If governments, media and the like do that, maybe they’d get a better understanding of what matters to people most.