Mike McCarthy, CEO of Victorian based Barry Plant Real Estate, which has a network of more than 80 offices, said the impact of negative forecasting has resulted in a decrease in consumer confidence affecting potential buyers, with many deciding not to purchase properties, in the belief that the market would decline even further.
Mr McCarthy, who has more than 18 years’ experience in the Melbourne Real Estate industry says the current ebb is a normal part of the real estate cycle and that it’s now time for the market to rise again.
“It’s ludicrous to put too much faith in forecasters such as American property market analyst Harry Dent who believes the Melbourne market will completely flatten out like it has in the U.S. All they are doing is scaring off buyers when the market is favouring buyers in a way that we have not seen for some years,” Mr McCarthy said.
“Experience and a range of other data suggest that it’s not going to happen. The Australian economy is strong – employment is up - it’s nothing like the U.S economy. This is just a normal part of the cycle, and it’s on the way up again.”
Mr McCarthy’s opinion is backed up by a recently released RP Data graph mapping the property market cycle over a 20 year period which shows there has been a real correlation between consumer sentiment and sales volumes, showing both indices recently reaching a natural two-year low.
However, the RP Data graph indicates both the market, and consumer confidence, are now once again on the rise. This is further backed up by just released data from the Westpac Melbourne Institute Survey of Consumer Sentiment ‘Time To Buy a Dwelling’ index which shows that consumer confidence rose 8.1 per cent in September 2011.
“This data shows that it is ridiculous for potential buyers to wait for prices to drop further. Now is definitely the time to buy. People who wait run the risk of missing out – and will have to wait for the cycle to come around again,” Mr McCarthy said.
For further information please contact Mike McCarthy, CEO Barry Plant Group, on 03 9840 9555.