GOOD NEWS AND BAD NEWS
From whom should investors take their advice?
Article originally published FEBRUARY 2, 2004 –Reviewed and approved.
By Neil Jenman
Taking investment advice from real estate agents will be more important than ever in 2004. So says Enzo Raimondo, the CEO of the Real Estate Institute of Victoria (REIV).
In his own article headed, Property will remain a good investment in 2004, Mr Raimondo hailed the virtues of property in Melbourne where prices recorded “sustained growth in 2003”. Raimondo said the REIV believed prices will continue to rise in 2004. “The basic laws of supply and demand will ensure growth in 2004,” he said.
So, good news for property investors.
According to Raimondo, the agents who are “best trained” to offer investment advice are, well, you guessed it, Raimondo’s agents. The reason is simple – REIV agents have “access to the latest statistics”. Now, that’s important because investors need agents with access to statistics. This sagacious advice was given just over a week ago, on January 24.
Yes, buyers, just keep buying and make sure you choose an agent who belongs to the REIV.
But wait. Fast forward seven days to January 31. This time the headlines are somewhat different. Boom goes bust, said the Herald Sun after new statistics showed that prices fell in 122 Melbourne suburbs in the December quarter.
The Age reported that it was the “official end to the property price boom.”
According to valuer, David McRae, “The market can’t handle any more sustained growth.” Another agent, John Tucker from Cranbourne, said sales in January had been “the lowest in almost a decade.” And, on Saturday, the auction clearance rate in Melbourne plunged to 39 per cent. At many auctions, there were no bidders at all.
So, bad news for property investors.
But wait. In the weekend press, Mr Raimondo was reported as saying, “We have no evidence of a bubble burst.” Well, that’s reassuring.
So, who is spreading all this doom and gloom news? And where did the statistics come from that showed prices have fallen in almost half of Melbourne’s suburbs?
From the Real Estate Institute of Victoria.
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