The PROPERTY DOCTORS, Sydney Australia Novak Properties
NOVAK PROPERTIES CREW and PROPERTY LEGENDS in the industry share their experiences and knowledge. Hacks and tips to make you a smarter property GURU :) Learn with exclusive content, advice, insider info and HOT real estate industry PRO SECRETS. For sale, for lease, residential, commercial, buying off the plan, finance, mortgages, interest rates, first home buyer, investments - all topics covered. The untold real estate info you've been waiting for.
The PROPERTY DOCTORS, Sydney Australia Novak Properties
EP. 1433 Price Action Update From the Front Lines
The true state of the property market often exists in a parallel universe to what's portrayed in mainstream media headlines. While evening news programs continue to peddle doom and gloom narratives about interest rates and market crashes, on-the-ground real estate professionals are witnessing a dramatically different reality.
This eye-opening discussion reveals the disconnect between media coverage and actual market behavior, particularly in what agents call the "essential" property segments. Unlike luxury or discretionary purchases, these essential transactions—first-home buyers entering the market, growing families upsizing, empty-nesters downsizing—continue to drive significant activity regardless of broader economic conditions. The evidence is compelling: a two-bedroom unit recently jumped nearly $100,000 in sale price within weeks as buyer numbers at open homes suddenly doubled. In Sydney's Northern Beaches, two-bedroom units that were available for $750,000 just 20 months ago are now pushing $950,000, representing substantial appreciation that contradicts prevailing narratives.
For savvy investors and homebuyers, understanding which market segments are truly "essential" provides crucial insight into where growth will occur next. The experts share a valuable 10-year rule to evaluate any property market: values should roughly double over a decade in healthy markets, with more than doubling suggesting an overheated market and less than 50% growth indicating potential upside. By focusing on essential market segments and applying this 10-year rule, you can cut through media noise and identify genuine opportunities as we head toward what appears to be strengthening market conditions through 2025 and into 2026. Speak with your local agent about how these patterns are playing out in your area and what it means for your property decisions.
People seek the information of what the property market is up to. So much so every time us real estate agents meet people, they will pick and pick and pick, trying to understand what the property market is doing. We're going to give you a summary that mainstream media is never going to give you.
Speaker 2:Stay tuned josh web shot. Good morning mark. How are? How are you? Yeah good, you yeah good good. Excited to speak a little about this one this morning.
Speaker 1:Yeah, so you're out there, You're talking to prospective commercial tenants, you're talking to prospective buyers in residential. You're sort of nicely stretched across all the markets in real estate and you wanted to talk about this topic this morning.
Speaker 2:Yeah, I did. I've had a lot of interesting conversations. Obviously, if anyone didn't know, novak's a little different. Essentially, we have all agents selling properties under the banner, so I work with a lot of buyers a lot of the time as well, and one of the main things I've had come back to me over the last two weeks specifically is what people are hearing on TV or the media versus reality, and that being that they're missing out on properties or properties are going, or you know, far exceeding their expectations in terms of price, but when they're at home at 7 o'clock for the 6 36 o'clock news, it's, it's doom and gloom. Oh, my god, you know what's gonna happen interest rates, this, that. So I guess they're very confused because they hear one thing from online news, all those sources, and then they're in amongst the the property, uh, buying journey and if they find it to be quite different oh, you know, I like doom and boom because you know you open up like one, one thing and then, like three days later you're having something.
Speaker 1:You're like I thought, like you know the market's gonna explode. No, it's gonna. It's, it's hard, um, and, and you know what's different these days I love the saying um, um, actually people when I say it and they go how's, you know, how's the house, how's the property market? And I go look, it's been really really good the last hundred years and I think it'll be equally, you know, really really good the next hundred years, and they're like that's not the, it's not the answer people want, but it is the reality. So you know, it's one of those things.
Speaker 1:Where we are, we are, our appetite for information on the spot, straightaway, is far greater than what it ever, ever, ever, ever used to be. So you know, people's consumption of it's almost like checking your watch, checking the time. It's like almost like the property market. People used to just be a lot more. You know you'd get your data quarterly, you know. Or you know coming through from banks and inflation. Now we're getting our data daily. Um, it's, it's it. It's not not the like. People are like ice addicts with it. But you know, people are just more like what's happening, what's happening, what's happening on on the market, very reactive, very reactive.
Speaker 2:Um. We're talking about a um, an example um from from one of our uh teammates in uh or colleagues within novak had a property on market unit two beds, one bath, one car, lock up. Elderly vendor there needed a certain amount of money to move on to their, to their next, next steps or next journey. So it'd been on market for for numerous weeks. Then all of a sudden, last last two weeks open homes numbers skyrocketed. So from originally we were looking at three to four, all of a sudden you're getting double digits, nine tens and over. And all of a sudden that negotiations price level wise, almost another 100,000 from where the best offer was from the previous six weeks, which, unit wise, is huge, almost 10 percent. Um, so that factor of new buyers entering the market, um, I think we're speaking about that two better under a mil is the stock. That seems to be going crazy right now.
Speaker 1:Um, and that was one of the big uh examples we had yeah, look and that, that core unit market, that sort of you know two bettors between 750 to 950, that's a big market in the northern beaches of sydney. Um, it's sort of slightly tucked on, uh, around the first home buyer market. It's a huge, huge market and I've witnessed just in the last 20 months you could have put your finger on a two better for $750,000. Quite comfortably. Now we're from what we're seeing like right up to now as in today that figure's getting more towards 950. That's a frightening. The data wouldn't come through on that for p, for you know rp data or for banks and stuff like that. But I've got a feeling, guys and girls who are watching, um, I've got a feeling guys and girls who are watching, um, I've got a feeling there's there's a real big rumble in that affordable market for units and houses big rumble yeah, I definitely.
Speaker 2:You can definitely feel, um, you feel something's coming. You start to see it in the little things, um, you know, a little bit faster in terms of commitment from buyers, your, your numbers starting to stack up at open homes, um, and, and it does really have that feel. And then what we were talking about this morning, before we got on, was that essential market of your, you know, your entry-level houses, your entry-level units. Well then, how does that affect the rest of the market? Um, and, and where does that money, money flow on to? Did you want to go through that mark? What we spoke about this morning?
Speaker 1:yeah, look, I think it's interesting the word you just used, essential um, the, the, the word that's coined around by governments is affordable um, and I think everyone raises their their eyebrow to that, to that word, because it's like how the hell can affordable be? Blah, blah, blah. Rent or blah, blah, blah. It's sort of, it's not sort of one size fits all. Um, it actually almost insults people using that word affordable um, because it's like man, how are you going to afford a unit for a million bucks? That ain't affordable.
Speaker 1:I love the word essential because I think essential is one of those, a section of the market at the moment where the business has got to be done. You know it's an essential part of the market because they're selling their one bedrooms and they're going into two bedrooms. That's essential. It's an essential part of the market because they're selling their one bedrooms and they're going into two bedrooms. That's essential. The family's growing. Or they're going out of the two bedroom into a three bedroom townhouse can't afford a house. That's essential. Or they're going in from the townhouse to the little house that's essential. Going from the five bedroom home to the five bedroom waterfront ain't nowhere near essential. So the parts of the markets that we can identify as agents at the moment that are doing exceptionally well are the essential parts of the market. Now, the thing that I love about that is that's applicable to all parts of Sydney. You can say in any part of Sydney oh yes, that's an essential type of price point or category of property that is not essential. Very easy to identify that way.
Speaker 2:Yeah, wow. And then, like you said, you got that flow and effect of, obviously, your smaller unit going to a bigger unit. You're then your seller of the bigger unit going into an entry level house, bigger unit going into an entry level house. So it's almost like a food chain of sorts. But once it starts to begin from the start, from your first home buyers, that should definitely follow through and it sort of lines up with their expectations of a better growth rate in 2026. If we're starting to see this now, heading into the third quarter of 2025, it definitely gives that time for that price action to move up through the asset classes and makes 2026 look like a good year for property.
Speaker 1:Well, I think, on going out on that, I think if I was to be punting, that's what I'd exactly say Look, look, I think we've got to be careful here. When rates go down, you, you mark your economies sort of shit the bed right, it's not. It's not a good, it's not a good. We all pray for the rates to go down, but we don't pray for the economy to be crap. So when they're trying to correct, they're trying to make good and get people, you know, kicking, kicking along a little bit more. When they're bringing the rates down, normally when property prices are absolutely skyrocketing, that's when you'll see them put rates up. Um, so it's sort of like be real careful what you wish for. Because at the moment I do think what you said part of me saying, well, the economy's, you know ain't, ain't that good that they're bringing the rates down. Then part of me saying, oh, market, the essential part of the market's going to boom. I think you're right and I think, guys and girls, if you want to, if you want to look, if you want to identify in your marketplace, you know what you should be buying and what's going to perform. Well, you know, essential would be, it would be good, essential, put your essential glasses on whether you're an investor, whether you're an owner, occupier. Um, and let's face it, you ain't going to be doing anything luxury on a on a on a on a 10 interest rate. But you are going to be doing anything luxury on a on a, on a on a 10 interest rate. But you are going to be doing something luxury on a two percent interest rate. So we've come off an environment where money was you know, it wasn't for free, but it was almost for free and we're in firmly in an environment now where the rates are, you know, above median, I wouldn't say expensive, but you know it, it forces your hand to be a little bit more conservative in spending with property prices or investing bottom line I'm I reckon we're gonna see.
Speaker 1:Oh, I was with a bunch of private bankers last night and something that I thought was very, very interesting that we were talking about was they were chatting, asking me pretty much this question, and what I was saying is in any of your markets where you are, check if your market is overcooked, check if your market is undercooked. That is going to identify what your property market's going to be doing and the way you do that and, josh, you probably hear me rattle on about this all the time is your rolling 10-year average of capital growth. If your property values that you're looking at have already doubled over a 10-year period, then I would suggest you're on track. If they've more than doubled over the last 10 years, I would suggest your market's overcooked and I wouldn't be buying that asset. If your market is 50% over the last 10 years, I think you've got some good room for growth.
Speaker 2:It is a great metric and probably something very handy Mark for people to use. Engage.
Speaker 1:Ask your local agent if you can't get your finger on the data. But CoreLogic and RP data aggregates all that information, ie houses in all the suburbs around our area, 10 suburbs they've all done in between 95 to 105 percent. They've doubled units. They're the rolling 10 year average. The last last 10 years, 50 on banking strata essential stuff is going to do very well.
Speaker 2:On banking houses are going to level out a little bit wow, I'd say I'd probably be uh on trend with you there. I think units will continue to do well that aging population. Um, we've got a couple of new sets coming out over at Casa Del Mar, hamptons and Havana down in DY and yeah, they've been snapped up quite well. So I think it'll be interesting to see how these off-the-plan projects perform heading into a market in 18 months, 12 months' time.
Speaker 1:Yeah Well, those retirees that's essential, Exactly. They just can't do the house any longer. They've been there for 52 years. They've got to get a unit. They will go into that segment of the market because it's an essential move and they ain't got time.
Speaker 2:Exactly right. I think we covered that this morning, Mark. That was good info out for viewers.
Speaker 1:Hopefully we helped some people that are scratching their head.
Speaker 2:The property market can do that to you yeah, have a great day, mate.
Speaker 1:Thank you so much no worries, thanks guys.
Speaker 2:Have a great day, guys. Cheers, bye. I'm the ringleader.