A soft decline in house prices over the past three months has “balanced” the Wagga property market, making it an ideal time for both buyers and sellers to make their move.
Property prices have grown by around 15 to 20 per cent in the past 12 months, which means that, even with a three to five per cent decline over the past three months due to higher interest rates, there is still a net benefit for sellers in the Wagga region.
Coming into summer, PRD Real Estate Wagga Wagga managing director Simon Freemantle expects the market to remain strong if interest rates don’t skyrocket.
“We’re seeing some new spring listings coming on and, with the more balanced market, now is a very good time to transact property,” he said.
“With a small decline in sale prices, properties are attracting their true value and the market is not heavily favoured towards buyer or sellers. It’s a very unique market.
“You can sell with a nice, speedy, fair value transaction and buy under the same circumstances.”
Mr Freemantle says the Wagga property market has been “extremely resilient” over the past six to 12 months when the city markets were experiencing significant declines.
From 2020 to 2022 Wagga experienced a 21.5 per cent growth in median house price, compared to 4.9 per cent in Sydney an 11.5 per cent in Canberra for the same period.
PRD chief economist Dr Diaswati Mardiasmo says sellers can still benefit from higher sale prices compared to 12 months ago, while buyers have an opportunity to benefit from a higher average vendor discount.
“Twelve months ago, the average vendor discount was around one per cent, even almost to full price in late 2021. Now it has widened back out to minus two per cent, which means that buyers have more ‘wiggle room’,” she said.
Following a dip in the number of property listings in June 2022, figures were back to normal by September.
“That said, growth in the number of total property listing for Wagga is lower than Sydney and Canberra, and nationally,” Dr Mardiasmo said.
New home buyers are still snapping up properties in the lower $400,000 to $600,000 price bracket, while high-end lifestyle property listings are few and far between, and always in demand.
“There is limited amount of new ready-to-sell stock coming into Wagga,” Mr Freemantle said.
“Anything under $600,000 is highly saleable, in demand and has the lowest number of days on the market.
“We’re still seeing around one to two dozen groups through open homes at that lower end of the market.”
With many investors selling up during the COVID property boom, there’s now an increase in demand for rental properties and, as a result, more interest from first-time investors looking to enter the market.
Rural lots and lifestyle properties close to town are “always hot” according to Mr Freemantle.
“People are looking for that work-life balance and want the country lifestyle close to the city facilities,” he said.
“Wagga is such a great place to raise a family, and if you can have some space to run cattle or horses, grow vegies and let the kids run around, it’s living the dream.
Demand for vacant land continues to put pressure on the Wagga market, with land releases failing to keep up with the population growth rate in the region, and a massive lag in the construction space.
“Council is struggling to deliver infrastructure and complete development applications and construction certificates due to a lack of staff,” Mr Freemantle explained.
“Normally we need to release 350 to 400 blocks per year to sustain Wagga’s appetite for new properties but due to hold-ups, we will only have less than 200 released this year. We will need 600 to 650 per year in order to accommodate the State Government’s population forecast of 100,000 people by 2038.”
Wagga’s defence, health and education training facilities continue to attract young people and families to the region and Mr Freemantle says that is contributing to the massive housing shortage in the area.
“Wagga’s a really vibrant place to live, with lots of young people and a strong business community. People are flocking here in droves, but the housing market can’t keep up,” he said.
“As the city continues to grow, there will always be demand for new and established homes as well as rental properties.”
His tip for anyone shopping for property in Wagga is to have their finance in place and be ready to pounce when you find your dream property.
“Days on the market are still short, stock is low and competition is strong, so people need to ensure they have all their ducks in a row if they don’t want to miss out,” he added.
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