There were times in 2008 when the property market was dead, and I mean completely dead. As a dodo. It had 'ceased to be', it was an 'ex market' (... you know the rest). In some suburbs, weeks went by with hardly a whisper of sale, and some real estate agents were taking extended holidays (not always voluntarily).
Looking back now, it seems fairly clear that November 2008 was probably the bottom of the market in terms of activity, and March 2009 was the bottom in terms of prices. As 2009 dawned, so sales started appearing in increasing numbers, with the first home owners grant and a 4.5% cut in interest rates making their presence felt.
From Feb 2009 on, the 'sub $500,000' housing market rattled along, and eventually, as the impact of sustained lower interest rates, stimulus packages and better economic news filtered through, so confidence started to return from the 'bottom up'.
Buyers, previously put off by the uncertainties in the market (and prospect of further price falls) started to realise they may have seen the worst, and now was the time to get in, or trade up. Investors figured the lower priced houses and higher rental returns now made the sums add up. Sellers were being more realistic (prices had fallen 20% after all), and the prices they expected matched what the buyers were willing to pay.
Today, 18 months after the slowdown began, properties are turning over quite quickly, as they are coming on well priced and demand is there. Throughout July and August 2009, most real estate agents have been selling again in earnest. Traffic to aussiehome.com has soared as renewed interest in the property market is being felt.
At the tightest extreme of the property market back in September 2006, there were just 2500 properties on aussiehome.com. By November 2008, listings had ballooned out to 9000. Today, we are back to less than 6000. And so the cycle turns. Some have called the current market 'normal' - and this is probably true, but one thing seems quite clear, the bottom of the market in the current cycle is now behind us (thank goodness), and we should be able to look forward to an upswing from here. One hopes the upswing will be measured, not get out of hand, and thus be sustainable. Will we learn our collective lessons from the cycle of 2001-2009? Only time will tell...
[ photo credit: flickr.com, 'Bombay Beach' by Ashcroft54 ]