Don’t you just love statistics? Depending on who you listen to, Melbourne property prices are either down about 3% (CoreLogic) in the last year, or UP 5% (REIV). Yes, you read that right, up 5%. Meanwhile, the headlines are screaming a decline of either 15% (Morgan Stanley) from top to bottom of the cycle is likely or, not to be outdone, just a week later, 20% (AMP). Or, of course if you want a real headline, let’s not forget 60 Minutes claim last month that experts think it might fall 40%. The fact that this is just Fake News and that the very experts quoted pointed out that their quotes were heavily edited and simply misleading, means little as the news cycle moves on.
In the latest quarterly suburb statistics for Melbourne, suburbs like Box Hill South and Blackburn South are shown as having decreased in value by 5.6% and 8.3% over the last year and a whopping 20% and 22% in the last 3 months. Wow. The end is nigh.
So, Lies, Damn Lies & Statistics. What is the reality once the stats and headlines are put aside? Firstly, the suburbs around those quoted above are currently down a little over 10% since their peak last year. Current values equate to values that existed around Christmas 2016. Did prices plummet by 20+ % last quarter? No. Are prices up over the last year? No. Will prices fall by 15-20% from top to bottom of the cycle? Probably. Quite simply we are more than halfway through that amount already. Depending on what figures you include or what criteria is used, statistics can be made to say anything you want them to.
The market is soft currently and drifting down still. Will it stop soon? Probably not. But when it is a buyer’s market, that’s the time for buyers to take advantage of it, rather than wait for it to turn up again. As has often been said, nobody rings a bell at the bottom.
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