It’s the race that stops a nation, that’s for sure. But if there’s a conversation that’s sure to hold the nation’s attention for the other 364 days of the year, it’s property prices and Real Estate in general. While the Melbourne Spring Carnival, and a certain Octogenarian Horse Trainer gets all the press attention, I thought I’d tell my own little story about another Australian Octogenarian, my own Aunty Marj. I was first told this story by my Mum not long after I started selling Real Estate. As background, 1987 saw a boom in Sydney Real Estate, with prices virtually doubling overnight. I started selling late in 1988. In 1989, things were already “off the boil”, and quite tough selling houses as interest rates started climbing.
One night, as interest rates were on their way to 17%, I went home after work and told my mum how tough it was to make a sale, with buyers saying things like “It’s not worth that! They’ll NEVER get that price!” One specific example that comes to mind (and I can still picture this conversation today, on the footpath out front of the house) was a buyer offering $155000 on a 3 bedroom house in Belfield, NSW. The owner counter offered at $160000 (asking $169000), but the buyer said “He’ll NEVER get that – tell him he’s dreaming!” (Yes, I heard that phrase long before it was made famous in The Castle.) By the way, Median prices in Belfield are now well into the $600000’s!)
Anyway, so my Mum tells me a story about my Aunty Marj, her big sister, and how she made a “HUGE mistake” in the 1940’s of buying a block of land in Ryde for 1000 pounds. (approx $2500 in todays bucks) A huge mistake? Yep! That’s what my Grandfather (her Father) told her! He said ” How could you be so reckless? So frivolous with your money? You’ll never see that money again! Median prices today are approaching $800000 in Ryde.
So you think – “What’s this got to do with the Melbourne Cup?” Well, you see, everyone wants a “sure thing”, and everyone thinks So You Think is a sure thing. But you know what – So You Think may win this Tuesday, but there is one sure bet that will not get a better return for your money, but won’t get a mention this week. Everyone wants the tip that is the sure fire winner, and here’s mine…think about my Aunty Marj and tell me that the best bet this week is anything other than buying, (or preparing to buy) a property. Whether it’s your 1st home, 1st investment (or 2nd, or 3rd), is there a better time?
So you think…you can pick the top of the market, and buy when it’s at it’s lowest? So you think… you can tell when interest rates are going to move, and which way? Even the highly paid experts get that wrong more often than not! So you think…you know what’s going to happen to property prices over the long term? Perhaps you should just ask my Aunty Marj (but just don’t listen to my Grandad!)