What's the property clock time in your capital city?
In this variation on the widely recognised property clock, API Magazine columnist Michael Matusik reveals where each of the capital cities sits in his interpretation of the market.
If you type my name into a search engine - God forbid - then often my version of the property clock will be one of the first articles in the run down.
I don’t know why, as I have said some pretty outlandish things in my past, but the clock seems to stick.
It is a pretty simple tool and for those new to such things (and for those that aren’t) bear with me as I explain how the clock works. It will only take a minute of your time.
There are four phases to my property clock - recovery, upswing, downturn and stagnation. But let’s make this even easier. Replace recovery with spring, upswing with summer, downturn with autumn and stagnation with winter.
What happens in each season rings true for each stage of the property clock. Yet they aren’t equidistant in terms of duration.
The typical property cycle is four years (which will be covered in next month’s column).
And yes, it’s four years, not seven like many say (including me in the past).
Typically about half of this time is spent in stagnation.
The upswing is often short. A downturn can be longer than an upswing.
Where a location is positioned depends on the balance between supply and demand.
A recovery is when demand starts to exceed supply; an upswing is when demand grows much faster than supply; a downturn is when these two measures swap around, and a stagnation is when supply is adequate relative to demand.
Real estate is essentially all about supply and demand.
If you draw a line across the property clock above, half the cycle is a buyer’s market and the other half is a seller’s market.
Many who wax lyrical about the housing market gets these two zones mixed up!
Also, it must be noted that sometimes a location misses a cycle and sits in stagnation for a long period of time. This happens when the market was oversupplied or overpriced during the previous cycle.
Think resource-based Queensland regional towns or the Gold Coast apartment market in the past.
Now that explanation is out of the way, below is my more detailed reading as to where each of the Australian capital cities are currently placed in relation to my property clock.
