Market Comment July 2015

Our market comments will always be unfortunately based on very small samples. We do talk to as many prospective purchasers and tenants as we are able, but we are also reliant on agent feedback to contribute to our overall understanding of the market. Accordingly we welcome agent feedback to assist in forming a balanced view of market sentiment.
Deals continue to be done (and we thank those agents who have worked hard in contributing to our transactions this month) we do see some trends starting to form:

1. Decisions are taking longer. Although in several cases we have warned prospective tenants/purchasers that they need to be quick – they have missed out. Usually it is a case of them having to consult with their accountant / partner / spiritual guide / tarot card reader etc. We accept that for most, leasing/purchasing is a major decision. But we learned in our schooldays that homework is best done before the exam.
2. Agents who used to be kindergarten teachers. The GFC was good for the industry in that it shook the tree free of many agents who didn’t have the necessary skills to cut it in tougher times. Unfortunately the buoyant market is now seeing an influx of new agents who think that selling real estate involves a) placing ads and b) showing, as in the kindergarten exercise “show and tell”, except without the “tell”.  We fully appreciate that with each passing month we become older and grumpier. And probably more cynical. But please keep the ex-kindergarten teachers away from us!
3. The move to quality. It’s taken a while, but we are seeing increased quality demands – from potential tenants in particular. A succinct way of describing it, is that people live in better equipped and functional  houses and they don’t want to go to work in an environment inferior to their home.. And in an era where quality staff are hard to find, part of the equation in retaining them is by providing a quality work environment.
   We believe that in time greater gaps in price will open as tenants are aware of the value in well equipped and functional premises. Perhaps it is time that agents focussed more on standards and amenities and functionality – rather than simply on physical attributes?