The PROPERTY DOCTORS, Sydney Australia Novak Properties

NOVAK NEWS - LABOUR WINS, MARKET CHANGES. WHAT'S NEXT?

• Billy Drury, Bidhan Shrestha • Season 30

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The property market stands at a pivotal moment following Labor's electoral victory, with uncertainty finally giving way to renewed confidence and clear direction. Buyers who have been hesitant to commit during the pre-election period are now emerging with fresh enthusiasm, particularly in the Northern Beaches where market sentiment plays a crucial role alongside supply and demand dynamics.

Our experienced agents have observed tangible shifts in buyer behavior just days after the election results, with multiple property exchanges and investors actively seeking opportunities. This surge in activity comes as no surprise given Labor's substantial housing policy initiatives. The expansion of the 5% deposit scheme without lenders mortgage insurance removes significant barriers for first-home buyers, while the groundbreaking 2% deposit option for key workers (with government co-ownership) creates unprecedented opportunities for essential service providers to enter the market. With $10 billion allocated to housing initiatives, the commitment to addressing affordability challenges is both substantial and promising.

For property seekers, the timing couldn't be more opportune. Financial experts predict up to three interest rate cuts in the coming period, potentially reducing the cash rate from 4.1% to the mid-3% range. This translates to approximately 10% more borrowing capacity for every 1% decrease—adding significant purchasing power just as market confidence returns. Northern Beaches buyers should note current stock levels are exceptionally low at 683 properties (well below the normal 850-900 range), with strongest competition in the $1M-1.4M bracket. For investors and first-home buyers alike, strata title units represent particularly promising opportunities, with experts forecasting approximately 5% growth over the next twelve months. Ready to explore how these market shifts could benefit your property journey? Contact our team today to discuss your options in this rapidly evolving landscape.

Speaker 1:

All right guys, here we are, monday night Novak news, excited for this right, it's Vedan and Billy. Today we're talking about the election. Well, it has happened, but what change is it bringing to you and the buyers that are looking to buy? Stay tuned to find out more.

Speaker 2:

Good evening. Good evening, how are we doing? I'm great, I'm so excited that there is no more election news. Yes, I'm so glad to see the post, post sign posters come down all the spam messages coming through for this. For that, yeah, stop now I understand why, uh, real estate agents aren't like all year round.

Speaker 1:

It's being on the other side.

Speaker 2:

It's different right on the receiving side but in all seriousness, to have an election out the way. Not only does it mean we got a new party, uh, back in, back on the job, we've also got, you know, pretty much a big, a big, you know, yearly event alley wave. So the calendars clean, different for the year ahead and you know, I guess we're going to talk about the changes, what happens next. But really, that uncertainty it's never good for the market. It does impact buyer sentiment and I think that's a big factor, particularly on our Northern Beaches market where it's a constant way up of supply and demand. But sentiment's another big driver.

Speaker 1:

Yeah, totally. In the last, I think, two months I've noticed a lot. I do do with residential and both commercial as well. So most in the commercial side people are not that confident to take that final step, like everyone's just done everything, did the due diligence, but not taking that final step, because they were evidently uncertain okay, what's going to happen? Yeah, like, which party's going to win? Uh, what are the new rules that are going to apply? And should they make that move, because it affects a lot? Yeah, like it's like that one last moment that is a new make and the rules change and it thinks things go sideways than you plan. So I think people have the reservation. You know people that are wanting to invest big or wanting to go big, but I think all the normal stock moves really quickly, right.

Speaker 2:

Day-to-day market has been three to four weeks once, once properties are online with realestatecom and domain stock levels remain low again. That's. That's uh tied back to the fact that people are a little uncertain with what, what happens next, but the election, um, you know, has been on the forefront of everyone's. You know, basically radar. Um, there's a little over 700 properties on realestatecom and we were, we were working with the number one auctioneer on northern beaches saturday afternoon and he was saying, you know, in and out of front doors, um, properties are selling but they're still, maybe, you know, an average of one to three buyers per auction, not not sort of five and six and that's some real stats for you from who does a lot of auction, and they know the market very well as well because they see it live and they experience it from throughout all ranges from, uh, one bedroom units all the way to big luxury houses.

Speaker 1:

So that's what we're talking about. So that's northern beaches. Uh, they currently got 683 properties, wow, which is very low normally you see, between 850 to 900, that's our like good stock, yeah, and we're all the way down to 683.

Speaker 2:

So, yeah, so we kind of see it happening. So stock levels are down. That's a fact. Um, I'm hearing from buyers that the stock that is on the market some of it's been sitting for a little while and perceived to be slightly overpriced. So vendors are either meeting the market, making moves happen simultaneously on a new purchase so it's a relative or they're holding out for prices and at this stage you know buyers have been uncertain with an election.

Speaker 1:

Now that's over. What happens next? Yes, what's the new change? I think, with Labour winning the election, which is pretty obvious. Now, uh, they have with anyone with the entry level, but I think they made it a lot easier. Yeah, first point, I think, uh, they're removing the cap for the five percent deposit.

Speaker 2:

Well, yeah, the um. Yeah, lower entry barriers to the market is is um, a policy that both labor and liberal had in their campaign. But for labor, um, they've expanded the five percent deposit scheme without lenders mortgage insurance. Yeah, which is weak, and that's, you know, gonna give buyers the capacity to get into the market quicker. Yeah, uh, for less amount of money, and they're not going to have lenders mortgage insurance imposed on them. So that was traditionally the shortfall anything under 20. The bank was basically having um a premium on top, and it's known as lni.

Speaker 1:

Um, so they're they're, you know, putting a helping hand out with that, which is also right and also now I think they're launching out they're buying a property through two percent deposit, like the government does still own the 40 of the property.

Speaker 2:

So but you can buy a property from two percent deposit, yeah, so that's for key workers, yeah, um so, whether it be public servants, uh, you know some, some key workers, depending on your job class, yes, that falls under, but the shared equity scheme is a government incentive where they will partner with you and guarantee pilot line line, which is awesome yeah, that's a good helping hand.

Speaker 1:

Yeah, people who want to get into the property market and I would overwhelm with a big mortgage, that definitely helps. Yeah there's also going to be a little bit more choice.

Speaker 2:

There's being $10 billion allocated to housing initiatives $10 billion, yeah. First home buyers being given more affordable options, especially in outer and growth suburbs, so that again is going to ease housing pressure. Hopefully there's been funds allocated there to take a little bit of heat out of the market but also give people choice across different price points.

Speaker 1:

That's very true and I think now, with things coming on, they will definitely help in terms of stock as well.

Speaker 1:

They'll get more approval because they have been some new rezoning happening. So in places like Northern Beaches there's no more land to build, so the only choice is to rezone or change the criteria for that zoning. So instead of forced rezone, they can go slightly higher so you can service the demand, because at this stage there's a lot of people, as DOI people already know it's fairly dense, higher. So so you can service the demand, because at this stage there's a lot of people, as do I people already know it's fairly dense and it's very hard to find land where they can build high rises anymore. So, uh, throughout all colorado and arabian as well, all the shop top housing, now you can basically knock that down and build a four-story building. Yeah, those things are getting getting on track as well and and now they made it even more easier to do something like that and getting on track- as well, and now they made it even more easier to do something like that and with that again, I think, concern comes.

Speaker 1:

What about transport? But yeah, not sure if you've seen the news today. Uh, there's been new double-decker buses rolling around. Uh, pitwater road, not sure if anyone has seen.

Speaker 2:

It's blue this time and they're testing, testing them out on the streets, interesting yeah yeah, very interesting, yes, um, but I think in in summary, we're going to try and wrap this up under 10 minutes for you tonight, guys, the biggest change I think we're going to see is confidence to the back to the market. Um, with the election out the way, we've got new government set for four years. I think interest rates are going to be coming down at the next uh rba meeting and the big four banks are saying there could be as many as three cuts, taking that cash rate from three, uh 4.1 percent down to sort of the mid three percent. So that's going to put borrowing capacity back in people's pockets. Um, for every one percent change in the cash rate, it's 10 percent more borrowing capacity. So that makes a massive difference, particularly on a on a million dollar loan. The average apartment cost these days, uh, it's 100 grand.

Speaker 1:

So there's a big swing there and and generally where interest rates go down, prices go up because that borrowing capacity turns into spending power definitely, and I can see that confidence already kicking in because I think in the last two, three days we had four or five exchanges just in our agency right, and today, talking to, I think, two or three different buyers well, investors as well they pretty much called me saying, okay, what do we have? I want to buy right now because I know interest rates coming down. So they have that confidence yeah it's interesting.

Speaker 1:

So you know people are definitely confident out there looking to buy and I think it should have that good change like just something a bit more stable now and and getting everything uh, nice and easy, rather than getting tough. What's going to happen?

Speaker 2:

there you go. My punt for the next 12 months is that I I do believe that strata title units uh, I visit about a five percent growth rate.

Speaker 1:

Big time I totally agree, Totally totally agree.

Speaker 2:

Yep and the apartments that we're transacting the most at the moment, price point wise is anywhere between that million dollars to say 1.3, 1.4. Very much, I think that's-. That's probably where the hottest buyer competition is. Totally agree, totally agree.

Speaker 1:

There you go. Cool, that's about it. That's about it, but about it. We're always here. If you need any help, give us a call. If you need us to walk you through the process, and that's about it. Let's wrap it up. Thanks, vince cheers. Have a good night, bye.