Wolfdene recorded a 40% increase in land sales across its portfolio of projects from April to May as buyer urgency burst back into the property market.
“In the context of how many active projects there are, April was one of the slowest months on record in the Victorian greenfield market,” said Wolfdene’s Managing Director, Michael Goldthorp.
“Election uncertainty, continued issues in the lending space, doubts as to where prices were heading and the inability to sell existing homes all continued to weigh heavily on the minds of potential purchasers.
“Add to this a tsunami of negative sentiment reported by the media and a saturation of developer incentives and you had a buyer’s market with a lack of urgency in decision making for placing holding deposits and signing contracts,” he said.
But after Scott Morrison’s unexpected election victory and APRA’s decision to relax serviceability measures, as well as the talk around predicted interest rate cuts, Mr. Goldthorp believes the conditions have turned on a dime.
“The decline in the Victorian market was never about demand, it was regulatory lead. Our month-on-month enquiry numbers remained strong,” he said.
“Immigration numbers – which underpin demand in the urban growth areas – are stable and forecast by the State Government to grow as Melbourne heads towards a population of eight million by 2050.
“The fact remains that the city will need another 1.6 million homes in places where people want to live.”
“What we’ve seen in the past two weeks is almost a complete 180 with things coming back on to our terms a little bit. Two thirds of our May sales came in the fortnight post the election.
“Last weekend we had multiple buyers in the sales office arguing over the same block of land, this is something we’ve not seen since early last year,” Mr. Goldthorp said.
Wolfdene has a $2.5b pipeline of over 8,000 dwellings either under construction or in planning, making them one of Melbourne’s largest private developers of land.
