Appraisals up 34% in a show of confidence for Australian real estate

JULY 13, 2021

After a record 12 months for Australian real estate, vendor confidence across the continent remains robust, according to leading property group Raine & Horne.

Data from Raine & Horne indicates that property appraisals are about 34% higher than winter 2020 and remarkably almost 44% stronger than the same time in 2019.

“Often in winter, property markets take a breather. However, this year and despite the lockdowns around the county, plenty of homeowners are aware their properties have enjoyed a value surge over the last 12 months and are eager to make a move, says Mr Angus Raine, Executive Chairman Raine & Horne.

According to CoreLogic, national home values rose 13.5% for the 2020/21 financial year. The increase in Australian dwelling values was led by houses, which increased by 15.6% over the year, compared to a 6.8% lift in unit values.

Mr Raine says a lack of listings has been a stumbling block for real estate activity over the last financial year. “So, the 34% spike in appraisals is very pleasing and an excellent sign that the traditional selling market in spring will be strong this year for vendors and buyers.”

Addressing the latest round of lockdowns and border closures, Mr Raine expects that restrictions will run for a much shorter time frame across the board. “Compared to April 2020, we have the vaccine rollout, world-best QR code check-in systems, and excellent contact tracers helping to close links and stop the spread faster than ever before,” he said.

In NSW, appraisals are up 55%, according to Raine & Horne and are level pegging with winter 2019 and point to a strong spring market once the latest round of lockdowns in Sydney, Wollongong, the Blue Mountains and Central Coast is negotiated.

Mr Tim Le, Principal of Raine & Horne Gladesville Hunters Hill, says there is generally a few months lag between owners seeking appraisals and selling.

“The surge in appraisals is a good indication for the spring markets, and some buyers, especially older vendors, are waiting for the lockdowns in Sydney to make a move,” Mr Le said

On the flip side, Mr Le said there are still plenty of buyers, and by employing private inspections that follow NSW Public Health Orders, and virtual technologies, sales are still proceeding.

“The experiences of 2020 will help steer Sydney markets through the latest lockdowns and overwhelming our vendors are confident of achieving the sales goals once restrictions and ease, and we get closer to spring market conditions.”

In South Australia, appraisals are up almost 47%, which augurs well for the start of Adelaide’s traditional selling market in September, advised Mr Trinity McNamara, Co-Principal of Raine & Horne’s offices in Adelaide City, Salisbury, and Fairview Park. 

“We are receiving daily phone calls to our offices in Adelaide City, Salisbury and Fairview Park for appraisals, and 100% we believe this activity will translate into listings and sales and is paving the way for a fantastic spring market,” said Mr McNamara. 

“Over the last year, homeowners in northern Adelaide have achieved good growth, and now properties are selling for well-above expectations. We expect this confidence to continue and will ensure the appraisal activity translates into listings and spring sales.”

On the demand side of the ledger, upgraders and tech-savvy interstate buyers are leading the charge for Adelaide real estate, Mr McNamara noted.

“Over the last quarter, around 50% of our stock was sold to interstate buyers, many of whom have recognised Adelaide’s affordability. Many of these people are buying sight-unseen. 

“There’s also been an element of lockdown fatigue driving buyers to Adelaide, a factor we again expect to encounter to an extent this quarter.”

Appraisals are up by about 40% in Queensland compared to June 2020 and June 2019, according to Raine & Horne. In the far north of the state, Raine & Horne Port Douglas beat the state average in the last month of June with a year-on-year increase of 46%.

“We are just starting to run out of listings, so the surge in appraisals is promising,” said Mr David, Cotton, Director of Raine & Horne’s offices in Port Douglas and Mossman.

“There’s no doubt that demand in Port Douglas and Cairns has been driven by southern state lockdown fatigue and we are selling properties almost as soon as we list them. So, it’s pleasing to see a surge in appraisals.” In the 2020/21, Raine & Horne Port Douglas exceeded its financial year sales targets by almost 70%.

To demonstrate the strength of the Port Douglas market, Mr Cotton sold five apartments in the Coral Apartments building at 9-11 Blake Street, Port Douglas in one day. “We listed them on Friday 9 July, and they were all sold for $245,000 by 4pm the next day,” Mr Cotton said.