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REAL INSIGHTS
THE CHAOS MARKET
Welcome to the fourth edition of our Real Insights Market Update.
Welcome to the Chaos Market. Yes, we’ve dubbed it that for a reason. The real estate industry has seen unprecedented shifts and transformations, akin to the unpredictable and dynamic nature of the chaos theory.
At MRE, we have always strived to be at the forefront of innovation and excellence in real estate. Our commitment to understanding the market inside out, and our passion for helping clients achieve their property goals, drive us to deliver reports that are not just informative but transformative.
As we transition into cooler months, we remain committed to providing best practices and insights to navigate the dynamic real estate market. This Winter Market Report is packed with valuable information in both the sales and rental markets, reaffirming our role as your trusted partner. Together, we will navigate challenges and transform them into opportunities in the ever-evolving market.
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Rental Market
As the cold weather takes hold, Melbourne’s rental landscape is shifting to a phase of strategic pricing amid the ongoing housing crisis.
In Melbourne, the winter rental market experiences a significant slowdown, akin to hibernation, with fewer active renters and properties available. Although cold weather deters inspections, some still seek to move during this time. While rents continue to rise, the pace of growth has decreased since the post-COVID surge. The ongoing rental crisis persists, but strategic pricing by MRE results in fewer inspection attendees compared to the high interest in underpriced properties. Overall, appropriately priced rentals still draw interest during these quieter months.
Key Considerations
1. Rising demand
There’s a significant increase in demand for CBD rentals from office workers, students, and international visitors seeking the urban lifestyle.
2. Stabilizing rental rates
Rental rates in the CBD are stabilizing and, in some cases, experiencing slight increases.
3. Tenant price acceptance
Prospective tenants are more willing to meet asking prices, especially for properties with amenities and good transport access.
4. Opportunities for investors
The current rental market presents a compelling opportunity for investors, despite rising costs, with steady demand and gradual rental yield increases.
5. Interest in larger apartments
A growing interest in larger apartments reflects the work-from-home trend, as tenants seek more space.
There is an increasing demand for larger apartments highlights the work-from-home trend, as renters look for more space.
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6. Confidence in market growth
Investors and property holders should feel optimistic about the CBD market’s potential for growth.
7. Shortage of larger family properties
There continues to be a shortage of three-bedroom or larger properties for families, sustaining strong demand in that segment.
8. Attraction of unfurnished properties
Unfurnished properties are drawing the highest interest, highlighting the importance of flexibility for prospective tenants, along with desirable amenities like pools and gyms.
9. Transport accessibility
Access to transport links is a key factor for tenants when choosing rental properties.
10. Trend toward shared housing
More individuals are opting for share houses or apartments as a practical living solution.
Flexibility and amenities drive demand for unfurnished rentals
Unfurnished properties are generating the most interest, underscoring the significance of flexibility for potential tenants.
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Leasing Results in the Past 90 Days
In the past 90 days, MRE’s leasing activity has consistently offered property owners opportunities to maximize returns, even with a slight decline in average rents and a minor increase in days on the market. This underscores the ongoing resilience of the market’s dynamics.
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Melbourne CBD
Melbourne's Outer Fringe
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Sales Market
The Winter Surge in the Sales Market: Insights from MRE’s Sales Manager
Traditionally, winter sees a decline in market activity compared to the busier spring and summer months. However, this winter has defied expectations with a notable increase in demand.
Increased demand and competition among first-home buyers
Winter typically sees a market decline, but this year has bucked the trend with increased demand, especially among first-home buyers targeting properties under $600,000.
We anticipate successfully selling approximately 80 properties by the end of this quarter. This winter has seen increased demand, contrary to the typical market decline.
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Gradual price increases
Melbourne’s property prices are gradually rising due to tight supply but still lag behind sales volume increases.
National investor trends
Investor loans have increased by 10% nationwide, reflecting growing market interest.
Competition among buyers is elevated, resulting in reduced days on market.
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Thank you!
Thank you for entrusting MRE as your chosen property partner. It is a pleasure to work with you to optimise your investment.
Your trust in us means the world especially as we navigate the ever-evolving Chaos Market, our trusted relationship remains a constant. We are committed to providing you with top-notch service and support, ensuring your investments are thriving within this dynamic industry.
Thank you for your continued support as a valued client, and we look forward to many more years of partnership together.
Regards,
PETE HOOYMANS
Founder
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