Post-Covid market provides perspective

There’s been a lot of water under the bridge since then, (not to mention a lot of face masks), but in looking back over that period I think one of the key learnings, particularly as it relates to our property market, is just how resilient our real estate scene really is.

You see, whilst we are regularly treated to media headlines that talk about minor adjustments in prices one way or another over very short periods of time, regular readers of these posts will know that I am a big believer in the importance of long term perspectives where property is concerned.

So it was interesting to read that an analysis of property values by Corelogic shows that in the five years since the arrival of the pandemic, home values in Australia have risen by a cumulative 38.4 per cent. Yes, you read that right.

This number is particularly interesting when you realise that in the five year period prior to Covid, our home values rose by a more subdued amount of 20.6 per cent, whilst the five year period before that saw a rise of 14.7 per cent!

Now, if you simply focused on short-term price movements over the past five years, Corelogic would have indicated:

1. An initial drop of 1.7 per cent in the first months of the pandemic;
2. A surge of over 33 per cent between mid-2020 and April 2022;
3. A drop of 7.5 per cent over the next nine months as interest rates were lifted; then
4. A jump of over 14 per cent to the end of October 2024 despite higher interest rates; and
5. A relative levelling of values over the past four months.

So depending on which month or each year you looked at the monthly figures, you could have been elated, depressed, or confused.

From my perspective, there are two key lessons here. Firstly, if you want to know how the property market is performing, make sure you are looking at long term trends, not monthly snapshots, Secondly, if you look at the past five, ten or fifteen years, the underlying confidence in the Australian property market is clear, whether you are investing or simply wanting to own your own home.

Remember, if you need advice or assistance with any property questions or planning in Melbourne’s northern corridor, the team at Barry Plant Thomastown have the experience and local knowledge to make a real difference to your results. So feel free to give us a call on 9466 3233.

Regards,

Con Constantinou

Barry Plant Thomastown