Suburb Trends December 2020 | Abolishing stamp duty & market wrap up

What will happen if stamp duty is abolished and how have Australian cities performed this year.
2020 has been an insightful year, reshaping where people work, live and spend time. The question is what will 2021 bring? With the restructuring of stamp duty and opt in/opt out programs be a success? Moreover, will the government target this towards new properties like FHB grants or will it open the door, moving citizens away from new builds? In addition to the stamp duty conversation Kent and the team showcase capital cities performance during this year; which has the brightest outlook for the future?
Here’s what we covered:

• How will the abolishment of stamp duty work?

• Will flippers return to the market if they can opt out of stamp duty?

• How can property buyers maximise their return when renovating?

• How different states will calculate stamp duty and land tax differently?

• What are small ways flippers can increase their profit margin?

• How have the capital cities performed from one another?

• Has Covid really affected the property market, or has it boomed?

• Which small rural city has greatly benefitted from Covid?

• Does the fall in listing matter if the price of property rises?

RELEVANT EPISODES:
Episode 153 | Brendan Coates
Suburb Trends November
Episode 150 | Meighan Wells

GUEST LINKS:
http://www.suburbtrends.com
https://www.revenue.act.gov.au/tax-reform
https://www.realestate.com.au/property/78-ragless-cct-kambah-act-2902

HOST LINKS:
Looking for a Sydney Buyers Agent? www.gooddeeds.com.au
Work with Veronica: https://linktr.ee/veronicamorgan

Looking for a Mortgage Broker? www.wealthful.com.au
Work with Chris: hello@wealthful.com.au

Send in your questions to: questions@theelephantintheroom.com.au

EPISODE TRANSCRIPT: 
Please note that this has been transcribed by half-human-half-robot, so brace yourself for typos and the odd bit of weirdness…
This episode was recorded on 9 December, 2020.

Veronica Morgan: This is our suburb trends report for December, 2020. And we'll be looking at where prices are moving across the country, either up or down and why they're moving in this episode, we'll also be discussing some of the areas in new South Wales that have a higher potential for price rises. If stamp duty is abolished and we see a rise of flippers in the market, we'll also wrap up the year that was in terms of Capitol city changes.

Veronica Morgan: Welcome to the elephant in the room. This is the podcast where we love to talk about the big things in property that never usually get talked about. I'm Veronica Morgan, real estate agent buyer's agent co-host of Foxtel's location, location, location, Australia, and author of auction ready. And I'm Chris Bates mortgage broker. And I'm the data game before we get started, I need to let you know that nothing we say on air can be taken as personal advice. We always recommend you engage the services of a professional. Don't forget that you can access the transcript for this episode on the website, as well as download our free full forecast to report, which experts can you trust to get it right? The elephant in the room.com did I, you this month,

Veronica Morgan: Cause it's on one potential impact on the property market. If the new South Wales government is successful in its push to phase out stamp duty, it doesn't take a genius to work out. The demand is likely to rise or buyer's budgets will also arise, which of course will lead to prices rising unless supply increases accordingly many are also predicting the rise of the property flipper. They buy a rundown house, do anything from a quick makeover to a full renovation and put it back on the market as fast as they can. Their profit margin will receive an instantaneous boost if they can take the land tax box rather than the stamp duty box when they buy. And we asked whether there was a way to identify areas that would be most attractive to the flippers over to you, Ken, how did you go about the task,

Kent Lardner: This task at a market or somebody by suburb basis? And the first thing I did is I pulled out areas that were either flat or increasing in values. So typically we use inventory levels there and we filtered the data tables. We looked at those that had a bit of a high yield, or we looked at those with low inventory levels. And then what we did is we looked at the variance between a bedroom

Veronica Morgan: And a three bedroom median price in between a three bedroom and a four bedroom, medium price just as our first level filter. So that was our, that was our high level approach. And so that the variants, so ID there is that if you can add a bedroom within that budget range within that variance, that the logic goes that it would be worthwhile flipping. Is that the sort of

Kent Lardner: That's the theory? Yes, the theory is, and in a lot of cases, we find that it's actually the bathroom adding a bathroom going from a one bedroom to a two bedroom, sorry, one bathroom, two, a two bathroom brings about a significant change in a lot of the automated valuation models that we use. So typically there, the theory there is that a lot of the two bathroom properties are renovated and a lot of the one bathroom properties, especially in some of these older areas are unrenovated. So that's where that big price jump comes tricky.

Chris Bates: I mean, there was I think the law in your patch, Veronica, the two bed sort of terraces were a good target for families because I could add a third bedroom and potentially a second bathroom, but I wonder if that's really the product that people want, you know, that three bed, two bath and people really want four beds and maybe the flippers or go for those bigger sort of a state homes rather than, you know, the small terraces. What do you think about that?

Kent Lardner: Okay. Look, I go back. I'm showing my age here, but about 20 years ago we did a radio show. I think it was with Kevin. It might've been 15, 15 years ago and we've, we've actually found a number of one bedroom terraces in and around the inner West in your neck of the woods for Monica. And, and they they're long gone now, but at that time there were a number of one bedroom properties we could find. And we, we then did the, what if analysis? What if we converted this to a two bedroom, two bathroom or a three bedroom, two bathroom by using the loft as was the case for a lot of the renovators at the time and that that opened up some amazing changes to the, to the, what if it processed some of those jumped by 300 K or more so it left plenty of margin for the renovation. So I think it's a case by case basis. Certainly this research is not as a suburb level thing. It's very much a property level thing, but you want to look for the, for the fundamentals that a property level. And one of those is you're looking at the price segments. I think you don't want to be inventing a new price segment. You want to be, you know, at the lower end or in the middle and know that you've got pretty plenty of room to move in terms of price upwards.

Veronica Morgan: Yeah. That's actually something that we look at when we're assessing a property and it's sub price binder have a process orientation, Griffin, you know, can we use to use your sublet trends one, but you keep changing the link and we sort of gave up the new link because yours is even better.

Kent Lardner: I've got it there, it's there. And you can, the beauty of my wine is you can actually, well, they both mine. I put the original one in price, but we're actually talking about price know we used the price finder estimate to do the, what if analysis on a lot of these renovations. So you can actually add the bedroom and the bathroom in their system, but then you could also do the same better or worse to actually say, what if I renovate it? So that was one of the key features of that price. Find a tool that I don't work for them anymore, but you know, Hey, get the plugin. But the price segments, yes, it's on my website now, but that's an important thing. A lot of people buy it. The, in the upper segments are still think there's room to grow.

Veronica Morgan: And that's the thing. I mean, it, it, it's, it, it's still a little bit primitive and crude looking at that. Because like you say, it needs to be done at property specific level, but in a general sense, you can look at the price segments. And what that means is that the each price segment and how many buyers are in it, or how many properties have sold in the last 12 months in each price segment. And obviously you can say whether it's potential to move up a price segment by adding value to a property versus where, like you said, you're already at the top, but you're already in that highest priced segment into, you know, people worry about RV capitalizing when they're renovating. And when you're already in the top price segment or the most expensive price segment, and you thinking about renovating, you've gotta be thinking, well, actually does that then make my property, take it into a realm where there's very, very few buyers. So it's certainly something that flippers will be thinking about

Chris Bates: From the bridesmaid sort of element to this as well. You know, where, you know, you're trying to, the time from actually buying the property to when you sell, it could be six to 12 months, could be two years if you've got DA's and things like that. I mean, is there a sort of a CLT potentially could do where there's discrepancy of the price variance between two suburbs that are very similar aesthetically?

Kent Lardner: Um it could be another filter that sort of people looking for flippers. Absolutely. I did a big paper on that couple of years ago when we looked, I looked at a lot of the suburbs that did benefit from the ripple effect, so we could actually measure the ripple effect through time. So, so it certainly is the case. I think the other thing too, is that it gets that point where an adjacent suburb just becomes out of reach. It gets nudged out of the budget of most, most buyers. And I think that's one of the main driver main drivers of that ripple effect is I can't afford that suburb, but what about this next one? And I think in a lot of areas where the locals w Shan have given suburb a lot of the Sydney siders or the Melbourne CBD dwellers moving out, don't seem to carry that that bias towards those suburbs. So I think the regentrification factor is, is another consideration for these that come good. So to speak,

Veronica Morgan: That is the key to it. I mean, and certainly in a city areas, you would see, you know, you would have seen this 20, 30 years ago where workers cottages and terraces started through that gentrification process. And there was a lot of flippers then, because that was, that was certainly that time when there was a massive acceleration in interest in those areas. And now you sort of seeing any multivitamin bungalows, you know, those, those bungalows that are built in the say sixties and seventies, which were much more modest family homes than were used to these days. You know, you mentioned about the going from one bedroom to two, sorry, bathroom, one bathroom to two bathroom, Hey, was really common growing up in the sixties and seventies to have, you know, even four kids in a three bedroom house with one bathroom, God knows how they managed, but it was common mainly because we spent some more time outside, I think, but these days, you know, we expect immediate room and then obviously with COVID is a home office or study as well. So the demands on, on a family expectations of what a family home should have have changed. And I think that's where a lot of these flippers have come into those areas too. Haven't they, and turned a bungalow into something a little bit bigger.

Kent Lardner: And another interesting dynamic is how people search for their properties. So if you're using REI or domain, you can obviously do a search by two plus bathrooms. So what can often happen is people just bypass the smaller properties. Yeah. So that's, that's something to be considered, especially if you, if you're doing some of those renovations if you can bump it up cost effectively through a change of a floor plan and get it to that two bathroom or get it from the two bedroom to the three bedroom by some, you know, good cost effective approaches that can, can work wonders in some cases.

Chris Bates: Yeah, totally. I mean, that one makes me laugh a little bit. I'm sure you've seen this so many times, Veronica, where you you know, you wouldn't fall for it now, cause you'd look straight into the full plan, but you know, you think, Oh, for better in a good suburb, this could be great for our clients. And a lot of people would just rock up and then they get there and go, that's not a fourth bedroom, like the size of a, on a pool table or something like that. And you can't get anything in there, but, you know, I think that's a pretty risky where sometimes people just get a bedroom for the sake of it, but it's not actually functional. And it, you know, actually if anything, it annoys the buyers and turns them off cause they go they're hopeful and then get disappointed because it's not actually a bedroom.

Veronica Morgan: Yeah, it's true. Oh, it's above the garage. You know, I've seen plenty advertise where they are, but there is a fourth bedroom. Yeah. But it's not in the same building as the rest of the bedrooms. Yep. Now we did choose two suburbs to look at from Kent's list of flip up prospects and bearing in mind that obviously, because we're only considering the impact of a removal of stamp duty and it's only really on the cars right. At the moment in new South Wales. That's why we've looked at two. And interestingly enough, the number one suburb drum roll, I'll give nobody a for guessing it's going to be in Newcastle.

Kent Lardner: So Newcastle's for these locations that have got a lot of unrenovated houses that are on streets that have a lot of renovated properties. So yeah. Typically one of the things you look for is the, the, the, the highest price that you could find in the street in the last five years, and then compare the, what if analysis price to that. So that gives you a bit of an idea of that process fermentation, but down the street level. So yes, drum roll Adamstown, we've got in there Adamstown Heights. I picked on that's just up the road here. Adamstown Heights is really interesting because you've got a lot of fifties builds that are really tired. You, you, you look at the photos, they look really, really bad from the outside. That turns a lot of people off, but it wouldn't turn off a tradie or or a, a serious renovator.

Kent Lardner: And the other advantage is a lot of these timber. So you know, wood paneling or so weatherboard, that's the word you saw the gap in my head right there. So the weatherboard relatively easy to, to replace and, and not as expensive to extend. So you can kind of effectively a lot of the fifties where the boards didn't have near that bungalow character of the adjacent suburbs, but you can do them up quite nice and give them that, that nice sleek look with the right boards and the right, the right design. So Adamstown Heights, we found a property in ironic present, and it's currently listed at between seven 20 and seven 80. And then I did a quick look up and down the street and I found a property that was a rundown. It was only a few doors away, literally three doors away.

Kent Lardner: That's been renovated. That's now four bedroom, two bathroom property in that you'd value that at the moment at about 1.15, certainly that's what on the house has it valued at? So, so that's a good example of, of, I think a property now there's going to be risks and all of that, you know, you want to make, you want to make sure that it's not just your, what if analysis that you're doing? You want a good building and pest inspection and a good tradie to come through and give you a as close to a fixed price quote, as you could possibly get.

Veronica Morgan: Yeah. I and there's a lot of us Bestos in those homes as well. And the reason I raised that is because I just have a particular example in Adamstown interestingly, when I was filming the show and we had a young couple who he's a, he was a trainee and really keen to get in and renovate their first home. And we found this little Farborough box and it was fine because it was all non fryable in the sense that it was only in really good condition and painted and, you know, and so they could choose to renovate as you know, in their own time. Right. Except for the fact that when the building inspection was done, they'd discovered that there was a specialist also in all the internal walls and the roof. Yeah. Very,

Kent Lardner: Very dangerous stuff. And does awful damage to the valuation of the house.

Veronica Morgan: Terrible. And in this case, it was just, it meant that they couldn't do, I mean, and obviously they weren't going to be flippers. They weren't, they were first home buyers who would prepare, you know, wanting to renovate over time. And it certainly wouldn't have worked for them. It would have worked for a flipper because yes, it probably would have cut out all of those different cutout, these buyers, it would've cut out nearly all the other buyers and the flip I can go in there and actually in one hit get rid of all the espestice and start from scratch. But once again, big risk and big added cost.

Chris Bates: Yeah. Good call out. It is a, it is a risk and a lot of those properties. So I think one of the things that flipping is I do think that you want to be buying in a market that's already rising and there's already process a lot. That'd be high by the time you do your flip, even if you don't even renovate it, the, the neighbor's going to be worth more in a year's time. So, yeah, cause that, de-risks you a lot, if you do overcapitalize and you do hit a problem with your rhino, a lot of that can be protected because the process of the properties potentially rising. So

Veronica Morgan: It's more risky than actually doing your numbers on the renovation. You know what I mean? Because like it could turn, as we all know, and I've seen plenty of people caught up by that, that we're utilizing and they were factoring in rising prices as their profit. So they

Chris Bates: He'd still be wanting to do it. The rhino, knowing that there's a profit margin without the market broadening. But if you can pick two suburbs, a market rising where there's strong data in our data market, the buyers are out there. And this neighboring suburbs, a lock that versus a suburb with no property sitting on the market and not selling just a real good protection mechanism that yes, you, you potentially could get a lot of money just through the growth of the suburb. And then you get the growth of the value of the renovation. And I think that's where you're going to make some real money. And a lot of the people with renovations would say in that situation, I made 500,000, but then I'll always say, well, what was actually the market period was that, you know, choose 300. If you didn't do a renovation, what would you have resell that property for? And then it stopped what we made 200,000. And then you can kind of really say that it wasn't sometimes the rent that night, the money, it was actually just the market movie.

Veronica Morgan: The other problem with that too, is that it brings more flippers into the market when you've got a rising market. You know, there's always more speculation that recency effect, right? Oh, probably prices rising and they're never going to do anything else. So it's that sort of risks as well. Others who may not be as cautious as you getting in pushing up prices, and then you're forced to compete with them,

Chris Bates: Especially if you're doing old, pretty average rhinos, right. And you're not using a real quality product that the market really wants at that point in time. You know, you don't want to do any Hamptons five years ago, but if you do the Hampton stalling 2020, you'll sell it. So I think the actual fit to market of the rhino, I'm sure you've seen It Veronica, where you just think you should not have renovated this place in just throwing money away.

Veronica Morgan: And just interestingly enough, I just sorta did check on domain 31 properties currently for sale in Adamstown town and this fair, diverse city in the stock, you know, from RedBrick units through to new units. And then really old houses look like they're right for a Reno, you know, through the new townhouses and duplexes, it seemed to be quite a lot of demolition and subdivisions going on. So bit of action there. Now, the other suburb that you chose was empire Bay. Anyone who doesn't know that's in the central coast,

Kent Lardner: Well, if you get the, this is for the, for the old people. So obviously not my demographic, but 30 or 40 years ago people used to have a lot of holiday homes up in the central coast. And a lot of these suburbs still got those original holiday homes and it's quite fascinating. So you can go and go to a street and some of the price variances between those that might be on or need the water to further away from the water can be several hundred thousand dollars and can be in the millions. And I've found a property here at Ricard road, which is exactly that you've got properties down one end of the street that a $1.5 billion plus up near the water. And then a little bit further back, you've got the stereo typical holiday house, the fibro fibro shack. So it's as quite fatter fascinating, but we found one particular property here.

Kent Lardner: And it doesn't have an advertised price on it, but when you do the price sword, it's a nice, neat trick on the portals to kind of see where it fits. And it does look like there's a potential there. If you look at some of the higher price properties, there's very similar properties that aren't on the water that sold a few years ago for about a million dollar Mark. So we are kind of talking about that potential of 300 K plus variance between renovated and un-renovated.

Chris Bates: So, I mean, I think the central guys is a very good spot to do it. I think Newcastle is, but not to a as, you know, greater extent. I mean the, just because of the Sydney buyers, you know, aren't really going to potentially want to move to the central coast and then for a full Reno, you know, and they've got a much bigger budget than say the locals do, and they want to get that sort of, you know, place just moving and get going and they can't afford Sydney. So I think it's one of those markets where the buyers are moving up there and we think budgets. And so that there's not that many properties that are fully renovated and tick all the boxes. So there is actually scarcity there because they haven't had really the demand there from the CD buyers until opposite of COVID situation. So I think it's, whereas in Sydney, a lot of the rundown sort of places have already been ran out. A lot of them they've already, you know, are already hotly contested. So I think that's where you'll, you'll find that you've got a real shortage of supply, but also an increasing demand of higher sort of high Borrowing capacity buyers.

Veronica Morgan: So falling process though, isn't it, because you think about, you know, I've been in property now for 20, it would've been in real estate for 20 years and, and think about properties that were freshly renovated 20 years ago. And now coming on, you know, the equivalent of unrenovated because people is dated. So, so this is even so yes, your Sydney might be gentrified, but the entirety of the city isn't and everything goes through its phases. So he definitely not getting the one bedrooms anymore. There's a few of them around, but interestingly enough, in empire, by any 11 properties for sale, currently 252, though, if you include surrounding suburbs, but what in, in improv I thought was quite funny. It's everything from what looked like caravan park, Kevin's, you know, three in a brand new home

Kent Lardner: By play havoc with a lot of your data and analysis. So there's several suburbs around the country where I just cringe because you know, they, they they're located in these, these parts and they, they do, they do flow through, into the data set. So you'd need to be very cautious and deal with those. So yeah, they're not your typical freehold house.

Veronica Morgan: It's so funny to see them there. Now, we also mentioned in our last severe trans episode in November, that we'd see if there was a precedent in the ICT for what the removal of stamp duty could do to property prices in new South Wales. And we asked Brendan poets, this question in the episode released Monday, and that's number 153. Can you believe with this episode? Cause we haven't included the subject trends episodes in our tally, these episodes 159, that's phenomenal. Anyway, that's just de digress. Didn't explain that the act of phasing stamp duty out rather than using the opt-in or out system that new South Wales is proposing so that we wouldn't expect to see a dramatic effect on prices. And in fact, they started back in 2012 and it's a 20 year plan. But can, you did take a look at ICT price growth over the last five years? Anything of note?

Kent Lardner: Yes. There were a couple of key things. So in Q3 2019, I know that there was a change noted in July of 2019 on the stamp duty. So whether that was a step change or a significant change, I'm not sure, but if you look at the changing sales volume two is a huge change. So we kind of, we, we dropped by broadly in Q4 2019, things went up to 1352, but down in Q3 2019, the sales volume was 925. So a massive jump between Q3 and Q4 an equally the price did change significantly. So yeah, very interesting period.

Veronica Morgan: A lot more volume came on the market.

Kent Lardner: Yeah. Q2 to Q3 things went down. So we dropped by Nelly or give, give or take by about 10%. So we also had an election. Then you see all these spiritual data points to throw things out that.

Chris Bates: Can't though, is that let's say we put the election to one side and let's say that really was the stamp duty impact of the change to land tax was driving that dropping listings and, you know, volumes increasing in Q4 similar way with the new South Wales government. They're thinking about not being for every home, you know, cause a lot of clients that's, I don't want to buy this place at $2 million. Like not have to pay stamp duty. I'm like, well, you definitely will because you know, they make too much money there. They're not gonna allow the expensive potentially 20% of properties to pay land tax over stamp duty.

Chris Bates: And you know, that's a huge revenue they want to keep on coming. But what will happen is let's say that it's a million dollars when no one knows exactly what the stamp duty land tax threshold. But properties at say nine 50 will be super hot because first buyers will be like, well, I only need a 10% deposit for this. Rather than a 15%, if I buy something over a million. So what you were saying is that we a huge push of, and people were spending a little bit more than a million say, well, you know what, let's just all down. Let's buy something at nine 50. And you find this and then you were always, so you're kind of like this because always like it's not the nudge factor. Like people go, you know, what happens with the policies, et cetera. So it's can, all these sort of things will play out in the market where they weren't meaning to create these.

Chris Bates: This is what all this is the behavior that will happen after. And so you'll find that you've got to be worried with these flippers, because if let's say you bought something at 900, you guys spend a hundred thousand on it and you want to sell it for 1.1. Well, a lot of the 1.1 buyers might be buying at nine 90 now. So and so there goes the idea of the fleet. So my frustration thing is with this sort of change is if you're going to do it, you might as well just do it for everyone and actually stop the sort of arbitrage where you're going to start to create these ceilings and push people in certain directions.

Veronica Morgan: The problem is it's a political system and they have to negotiate this stuff through with the opposition. And so that's when it all gets bastardized, but it's funny, Eliza Rowan, we interviewed her sometime a few times actually, but sometime back and we were talking to her I think I did on the podcasts. It might've been off the podcast, but anyway, she was talking about thresholds in first home buyer with first home buyer grants and how they, they can, they can demonstrate that there's, I can't remember the term, but basically this bulging deals being done up to the thresholds and then sort of a dip in the market. And it's really obvious in the data. So the same thing would happen. Of course, we saw the same

Kent Lardner: Thing in lenders mortgage insurance. There were clearly two spikes in risk. And one of the biggest response was just below 80% LVR. Funny about that. So massaging the values

Veronica Morgan: Is a problem. It's like you put these thresholds in place, but humans will behave the way humans behave. It's just what we love talking about in this podcast. And, you know, they'll find the answer it's like over it or find the gaps in the system now can original hypothesis that flippers would have reason in the act you went hunting for examples and could find only one. And of course, now we know why that hasn't been a massive surge because of course their stamp duty has been phased out as opposed to being dramatically reduced. Now, before I looked at, so I looked at this particular property that you that you discovered. And when I looked at the before and after prices and photos, I thought it would be an interesting case study to talk about. It's a 1970s bungalow in the suburb of CAMBA.

Veronica Morgan: It was purchased in June, 2019. So just after the election for 612,000, they did a complete internal and external make-over. Then they didn't add any rooms or anything that didn't you know, make the house any bigger. But they then sort of 854,013 months later. And so that's a difference of 242,000 after holding costs and renovation costs, you can sort of see how slim the margins are and stamp duty could be the difference between profit and loss. And I just sort of went through and I listed all the things that they've done. They've completely rented it, the carpet, new carpet, flooding floors, new kitchen, new laundry, new bathrooms paint inside and out lighting doors, blinds, wardrobes, skirting boards, and architraves, new decks, new new pathways, basic garden beds and lawn. I mean, that all adds up, you know, and I said, looking at that, the sale price, they would have bought well as well. And the market had reason. So there, there was market moving in that time. In reality, I doubt that you could even say they made a profit.

Kent Lardner: Yeah. We don't know what we don't know. There could have been some other issues that, that we couldn't identify. So, you know, it, it creates a significant risk for sight unseen stuff.

Veronica Morgan: Well, it does. And it's funny I was watching renovation. No, no it wasn't. I was watching restoration Australia last night an episode where they are renovating one of those big old terraces down Mila's point. And so the state government is sold these often they're all listed. And so there's massive heritage costs and the budget went was three times what they received despite it, but that was something called this guy anyway. But it was really interesting.

Chris Bates: That's hilarious. Cause they're gonna lose their view very soon because of the new Barangaroo. Yeah. Is that what you're talking about? These are F facing

Veronica Morgan: The bridge actually on the other side, this particular one, but it was more the fact that every time they started doing some restoration work, they uncovered something else that needed to be fixed. And that's where, you know, like Ken was just saying that it's, you don't know until you start doing work on these old houses, you don't actually realize the extent of work that is required. So it's these risky, I mean, this isn't really an episode on the risks of flipping, but let's sort of be remiss not to mention them.

Chris Bates: It's the sunk cost, isn't it? It's those costs that you, you know, you're fixing the chimney, right? You're not, you still got your fire, but the chimney needs $15,000 spent on it that no one's ever gonna put any value on. And, but you have to spend it, you know, going through a run out at the moment, you know, there's a few things that pop up, I need to do the electricity algorithmic firewall. It's no one's really ever going to value that for what it costs. So, you know what I mean? It's just where they only want to see the visual impact and no one knows that the thing that you had to fix it, you know, it's not gonna add any value. And that's the thing that ultimately adds up for a lot of money because it's not really adding value in the, in the buyer's mind.

Veronica Morgan: So thinking in a nutshell, yes, the removal of stamp duty will re I guess increase the attractiveness of flipping because it takes out that sort of additional 4% costs at the outfit at a front. And I'll say 4% thereabouts stamp duty. But but in reality, only those there's still masses of risk. And even though the market may be rising, they're going to be paying inflated prices too, because there can be more buyers in the market because that barrier to entry has been removed. So sort of you know, they can factor into their borrowing as opposed to have to actually pay it as a cost, but it's still probably going to be paid in one way or another.

Kent Lardner: The other interesting thing to look at is the potential for improving yield. So you're not flipping it to sell, but flipping it into a an improved rental yield. So that's the other analysis I think people should be doing

Veronica Morgan: Interestingly enough. And yesterday I actually hosted a webinar for property managers. And it was funny because we were talking about the you know, what's been happening in the rental market and it was new South Wales based. And one of the questions came in from somebody who's property manager in Newcastle was saying that basically the queue, you know, we were talking from Sydney centric, point of view is like, you know, yeah, rents are falling. Yeah, tenant it's a tenants market tenants can, can start demanding or are demanding rent reductions, but also due to them, adding more for their money. They want, they want more, they want more energy, efficient, C they want air conditioning. They want, they are picky and they can choose between properties now. Whereas when you're queuing up, you can't. But in Newcastle, because there has been this sort of migration out of the cities, you know, that there are queues at the rental properties, there's not enough stock.

Veronica Morgan: And so that's sort of an interesting time because I was talking with property manager, Lisa engine, we've interviewed her before. And she was saying that the moment in Sydney, it's not worth renovating to increase your yield. You know, whereas before you could, you could do a $20,000 up and you could get another 50, 60, $70 a week. Right. So, which is a good return on that. But in Newcastle, you might do that because it might have a much better yield, but certainly so it's very much, you know, renovating for yield very much depends on market conditions at the time and where you are.

Chris Bates: Yes. And I think that final thing on the frigging from my view is the big difference between flipping an investment property and flipping your home. And if you can potentially make it your home and get a growing tax-free, I think that's a very, you know, much more lucrative to have to pay 25% of your profits, you know?

Veronica Morgan: Oh, well, so you got to remember it, and this is that, that Canberra property sold 13 months after they bought it. And I think that's important cause you had thought after the first 12 months, right. In order to get that, that 50% capital gains in a discount, primary place of residence, there's that too, then you'd have to pay any capital gains. All right. 20, 20, we're nearly at the end of the year, when the word unprecedented was used and unprecedented, number of times, despite all the dire predictions might around April may, all capital cities are showing price growth for houses. So let's take a look at them what we're going to do one by one, or give us a bit of a summary. Yeah,

Kent Lardner: Look, I might do it alphabetically, but look, the ICT was just a standout in so many ways. So it's obviously had an increasing in price. So it's, it's just, it's a huge market in terms of all the fundamentals inventory levels have very, very low at the moment. So lowest across all the capital cities that about 1.73. So I'm going to make a bit of a bold prediction for 2021. We might be talking about the act as the most expensive capital city in Australia soon.

Veronica Morgan: Oh really? It's a bold prediction. You want to have to put you in the full forecast.

Kent Lardner: So yeah, so it's just interesting to say how much the inventory trended, the low and prices are still growing. So there's been an 8% growth in house prices in terms of median CSR, a really interesting market moving on from ICT, greater Adelaide. That's not really had much of a price change at all. So, but inventory has improved. So when I'm talking about list prices here or to also our prices here, I'm looking at the rolling 12 months leading. So, but inventory is a good lead indicator and that's dropped by nearly one month. So it does look like things in Adelaide looking solid, especially greeting 2021. Brisbane, it say about the same at the moment just under five months of inventory, which is good, but trending lower. So same could be said for Brisbane.

Veronica Morgan: And I just want to sort of interject there for a bit because we ended up, Oh, I interviewed Megan Wells from Brisbane property pursuit a couple of weeks back on the podcast and talking about the Brisbane market. And obviously like all of these cities, you've got different too. You got micro-markets within the city, the major city market, you've got houses and you've got apartments, but she's been saying that that demand in Brisbane and inner suburbs for those sort of family homes is going through the roof and just absolute massive pressure on prices. And I spoke to also to another buyer's agent Melinda Jensen actually last week about the same thing in Brisbane. Competition is fierce and process is definitely on the rise of those inner areas and particularly sort of your more traditional Queenslander and those sorts of period homes back to where the board that are very much in demand. Yeah, so

Chris Bates: 800 to a million

Veronica Morgan: More than that, actually, they've got some, there's a lot of Sydney and Melbourne money going into Brisbane at the moment. And that is, you know, pushing up prices significantly. They are finding it. It's a hot market there, right. The minute.

Kent Lardner: Well, it's, it's anecdotal evidence for me, but have you heard of a lot of people moving out of Melbourne and just bypassing new South Wales going straight up into Queensland? Why did they, why did they hate new South Wales so much?

Veronica Morgan: I don't know when they have one summer in Brisbane, they might wish they'd come to Sydney.

Kent Lardner: So yes, that Brisbane's going strong and Darwin's always that interesting one it's yeah hot and cold, but in terms of the, the, the median price that the list price at the moment it's around $527,000. So it's not cheap relative to these other cities. It's, it's way up there in terms of prices, but inventory has dropped considerably. So it's dropped by nearly two months. So it's down to about 4.35. So it's kind of going from being a medium market in terms of no upwards or downwards pressure into an upwards pressure market. So Darwin's very interesting moving on Hobart.

Veronica Morgan: That is significant though, isn't it? Because that has been a shocker for a long time.

Kent Lardner: It has. So, yeah, so, but yeah, it's, it's one of the largest drops in itself. I look at the 12 months change in inventory. It's dropped by nearly two months, whereas, you know, the, the others the only other ones who have made that type of move is the rest of WWI of all the greater capital city areas. So it's a significant shift.

Chris Bates: I think the commodities market has a huge impact on, you know, in territory economy just like NWA. So I think that's all been going in the right direction. So, you know, we know the commodities market is so volatile that it has you know, much bigger than any other sort of real sort of asset and really, I guess science interesting to see that, you know, when you're investing in these areas, like basically a mining town, almost like Perth.

Kent Lardner: So you just gotta be super careful Hobart how about how bats are very, very tight level of inventory currently? So it's second only, only pipped at the post by the act, but it's just over two months of inventory. So it's tight, which obviously is going to lead to an upwards pushing in price. It's fairly flat. That's been a similar level of inventory all year long, so just over two months. So it's a very, very tight market. So I see continued growth there as well. Moving into Melbourne, the next one on my list. So Melbourne has increased marginally. It's up to about 4.2, six months of inventory now up nearly one month. So greater Melbourne does look like it's starting to turn in the, in the wrong direction in terms of, you know, likely price movements, but things could shift around, you know, we all know what's been happening down there and, you know, things are looking a little bit brighter and a little bit better, so I'm not too sure if the last 12 months is going to be a clear indicator of the next 12 months, but especially when it comes to Melbourne,

Veronica Morgan: Be rather interesting. And also we do have an episode on Perth coming up on Monday. So for anybody who wants more insights into what is going on in Perth that will be quite valuable cause we haven't actually done a Perth episode before then what's happening outside the capital cities can,

Kent Lardner: The, the rest of us have all performed quite well. So I think the big, the star performer in terms of a lot of changes in terms of price movement in inventory, the rest of new South Wales has performed very, very well. So prices have jumped up by about 10%. This is the median price. That's increased inventory levels have fallen by nearly one month and it's currently sitting at just below four months. So there's a strong demand and it does look like that will continue through into next year. So rest of new South Wales has done extraordinarily well, but equally so as the rest of Victoria. So outside of the CBD, outside of Melbourne city the inventory levels are very tight, actually a little bit tighter than the rest of new South Wales. So about three and a half months of inventory. So it's looking good for the rest of Victoria and trending down.

Kent Lardner: So yeah, I'd say that there'll be upwards pressure and in the rest of the Victoria as well. What about units? Unit markets yeah, different story now. The, the, the rest of the market, like when, when we look at units and we look at the outside of the CBD, the, the pro the, the prices do jump around a bit, depending on what's selling and way. So I'm always a little bit reluctant to talk about unit markets outside of the capital cities, the big guys. So with that in mind, look, the big focus, the big two stand outs for me would be the increase in inventory in greater Melbourne. So it's up close up close to the seven months of inventory Mark now, and that's increased by just over 2%. So usually I think we've covered it in the last couple of episodes. You know what that balancing point is, where it tips in favor of, of, of buyers around that seven month Mark is where things really start to turn. So once you get above that seven months of inventory, we start to see prices start to come down.

Veronica Morgan: It does make me laugh. And he said at seven months, it was like, Oh, I'd be thinking of they turned, Oh, probably around two months.

Kent Lardner: Yeah. I just, it's just a ratio. It's just our measurement systems. So typically what we find is equilibrium in America is about that. I use the term equilibrium, but yeah, around six months in for America, about seven months here. So once you get above that seven month Mark, you do start to see a downward shift in price. So that was, that was really interesting, but equally Sydney, not off the hook either, it's not been quite as high, a bigger change in infantry jumped by about one month. It's currently sitting at about five months of inventory. So I'm not, I don't expect a massive downward shift in Sydney, but there will be pockets. As we say, it's not one market of Sydney. There are several hundred markets across the greater Sydney. So we will see certain pockets that will have very, very high inventory levels that no doubt will have to adjust their prices to, to clear that inventory.

Chris Bates: I think Melbourne needs to kind of follow you know, new South Wales sort of decision around stamp duty to land tax because, you know, if you can get the first time buyers or people who weren't in the market, new entrance, they're more likely to buy units and houses just due to affordability is that sort of stage of life, their cash, et cetera. So that's really going to potentially save a lot of the newer units in Sydney. If we change the land tax, we allow people to access their super then you create a lot more demand and generally more entrance into the market. And they'll generally buy the units. And that's, you know, I think Veronica always says, I'm a conspiracy theorist. I ultimately do the there's sound. That's at play somehow here that they don't want to start to say, you know, lots and lots of units start accruing over, you know, all over Sydney and now they're to buy them off these investors, et cetera. So that could potentially save Sydney. I, if I was going to be Toya right now, I think, you know, for them, it's a good time to be making some stamp duty changes.

Veronica Morgan: I could easily fix that by just saying that first home buyers get a discount or free stamp duty regardless of what they buy, you know, they could, they could address that if that was truly their motivation 

Chris Bates: I'm a 25% off Luxor they did, but still 20 still going to pay 75%. Right. So yeah, I think they're trying to make changes there, but I think, you know, not paying anything at all, like they did in new South Wales, I agree would be a good way of doing it

Veronica Morgan: Well. And also because, you know, that reduces the risk of buying, buying brand new cars. That's bizarre, oddly enough. And paradoxically, I guess that the reason these, the market is filling up with stock is because if first-time buyers are the ones buying that stock and they're higher and their thresholds have gone up for buying brand new, they're not realizing there's no secondary market for what they're buying, because that is the secondary market. That's the massive warning sign for them not to go and buy a brand new, but they don't necessarily look at it that way. They see it as free money from the government. How about rental vacancy rates canes, because obviously we know that they can be a leading indicator for inventory levels and particularly around this unit space, any significant changes to reporting.

Kent Lardner: Look, the biggie is obviously the pockets. I think we covered this in the last episode, this a no massive shift between last episode. Now we've got large pockets in and around. Those universities still have high vacancy rates, but the, the number one trend, the big standard is the rest of, so the rest of States are facing significant changes to vacancy rates. So vacancy rates are extraordinarily low across the regions which we'll see, you know, that scenario, the case study, you explained about, know about Newcastle earlier. I think there's going to be a rental crisis in a lot of the regions, which is a bit of a worry, you know, a lot of people won't be able to afford rents. Yeah.

Veronica Morgan: Yeah. And you know, I certainly anecdotally hearing about people moving out and Sydney and my advice has always been, if you're gonna move out of a city into, into regional area and you don't know that area, then you should rent because you need to get to know the place and you get to know exactly what you want, where you want to be, et cetera, et cetera, and, and be sure that it's the right move for you. So it's not a one way ticket, but you know, that that's becoming pretty difficult when there's nothing to rent. And also another thing from that webinar that I was on yesterday talking to the guy that's an MD Matthew Matthew's, his name is he's MD of it's a Mirvac joint venture. It's a property management arm of Mirvac. And he was actually saying that the vacancy rate, obviously, you know, some areas that we're talking about, they're going up three times, you know, the vacancy rate tripled at the heart of COVID, but it has subsided a little bit and stabilized. So it's still a lot higher than it was, but it's, it's no longer rowing, which is heartening. Certainly if you are an owner of those sort of properties, but yeah, that's Sydney, that's, that's, you know, areas very highly effected by the, the Airbnb by the, you know, like a lack of overseas students. And just generally with everything that's going on

Kent Lardner: At a national level or close to 50,000 properties are being listed for three weeks or longer. Wow. The bulk of those are really spread across about 20 or 30 essay threes.

Chris Bates: I think the printing issue there's a social issue, especially when people are moving to rural locations on mass. It really bumps up demand is very little listings and pushes up rental process for people who are living there. You know, especially if the salaries rising in those areas and then you start to credit affordability issue, et cetera. So there's that side to rental sort of crisis. And then you've got people who get marginalized and pushed out and count rent and homelessness, et cetera. So it's a big problem, I think with, you know, even within Sydney and the upgrade is we've got a few at the moment doing, you know, where one's got a place, but wants to do an upgrade and has a 12 month lease finishing, or they're getting kicked out because the person selling the property and they're wanting to buy, but, you know, because they haven't got their ducks lined up, they potentially need to wait till next G and they're trying to bring it forward cause they kind of go and find something else to rent. They're just sign we'll, let's just buy something. And

Veronica Morgan: It cost me to rent there's heaps of stuff, relevant to rent in Sydney.

Chris Bates: This is more of a house as a three, three kid family in the East side.

Veronica Morgan: Yeah. That is difficult to rent. That is difficult to find, I should say,

Kent Lardner: Isn't boarding school. That's the answer.

Veronica Morgan: It's one bedroom apartments, heaps of them around

Chris Bates: Triple bunk. And then the other one is a similar situation where clients, you know, in the spirit wants to move up near may actually. And you know, I'm not sure if they're going to like it. So I said, well, let's just rent. And they're like, well, we can't find anything to rent. And it's true. It's hard to rent as well, but, you know, because it's tough to rent, they're potentially going to just take the gamble. And I think it's really dangerous to do that. You know, I think it's just, if it's hard to rent, that doesn't mean you should just go and try to buy us on these is going to be a high quality asset. And I think that's where it can change your behavior as well. But you just gotta be super go through the pain. You know, it might only be the last time you rent, but you just got to go through that pain. Cause it's going to be

Veronica Morgan: Before you buy is so much more bearable than pain after you buy, if it's the wrong thing.

Chris Bates: Yeah. Yeah. And you want to go back and see, it will stand Judy, et cetera, et cetera. Yeah.

Veronica Morgan: Now can each month we discussed something that doesn't quite fit the pattern. Do you have an anomaly for us this month?

Kent Lardner: I looked at sales volumes and how much they've dropped over the last 24 months. So typically about a 30% dropping in sales or sales volumes. And my anomaly is that the headlines are saying, prices are going up. Prices are surging. The market's doing quite well, but the realities lower sales volumes Does not mean a boom in time for the real estate sector or real estate agents. If there's 30% less volumes is 30% less commission. So it's a big industry that would be hurting. And the headlines are masking that.

Veronica Morgan: So not only 30% less commissions, it's usually more than that because when inventory draws up or when, you know, the appraisals dry up, then the competition ramps up and the agents start dropping their fees in order to be able to get listings. So, so that increases the pain really. And in fact, just on that, I mean, there's been some the game playing that goes on with some agents it's just been nightmarish. And this, this is interesting because, you know, I don't know if we can do a study on this, but it would be a very interesting thing to do because as as markets start heating up, what happens, yes, inventory starts drawing up listings, start drawing up competitive, competitive activity amongst ages heats up. Then you've got the agents that go in there and over quote, to try to get the listing. So they've got already, you've got owners with heightened price expectorations cause they're looking around go, yay.

Veronica Morgan: Clearance rates are high and process there's record prices being achieved across the board. Maybe I can get an extra 200 grand that I was thinking. Then the agent goes through to flatter them to try to get the listing. And they just hoping that the market will, will continue to speed so they can achieve it. And sometimes they actually do all they get is amazing price and the vendor was disappointed because they were controlled, but they got a crazy price. And I look at it. Thank you guys. I know you won't be happy with that, that result, but it was a really good result. And I'm finding out with agents at the moment, sort of coming to us with the pre markets and of markets for next year, starting to say, you know what? These owners have crazy expectations and it's fed by other agents who are pitching for this business as well. So, and what happens, I've seen this happen time and time again throughout market cycles, where when the owners start to get too greedy, when, when Jeff, the reserves get too much when you get competition, but it doesn't achieve those owner's expectations, clearance rates start falling, and then buyers are looking at me to go, what's going on, what's weed. This is weed, something wrong with this. And so there's this sort of strange behavior that goes on underneath, which can sometimes precipitate process slowing down. You know, it's the thing that happened.

Kent Lardner: Statement of information was only a part solution. I'll give you the, I'll give you the breakdown. Write a story about, at one time I went down to see Enzo who was heading up the REIV at the time and are proposed to be my three comp solution, which was all about a transparent view of the original CMA and those pumps that were used in it that they would be made publicly available as soon as the property lists. So it would in part, obviously seek to deal with underquoting and at the other end seek to deal with over quoting. So I think you know, at both ends that transparency of the comps and the original CMA are important, but I'm hearing anecdotal stories of one price is written on paper, which is handed across. And then the other one is, is, is entered into the CRM for any audit trail.

Veronica Morgan: Exactly. And that is what happens. It has been happening for years and you will have, look, these are the comps we're going to say, so the buyers, you know how to pull a frog, right? Check the frog and the portable and water supposedly jumps right out. I'm not quite sure how it does that when its little legs have been burnt. But anyway you know, whereas you put in a pot of cold water and turn up the heat, then he get a nice poached frog. So this is a, this has been going on for years. And, and some agents even have that conversation with their owner to say, you know what? I like to be able to quote what I've told you, because I'm confident it's going to get that price. However, the way the market works is that you have to under quote to a degree because buyers don't, they add on to what we say.

Veronica Morgan: And, and they actually have this conversation with the owners. The fact is it's true. This is exactly what happens, you know? And so they explained that they say, so if I quote what I've told you, I expect you're not going to get that. Because it requires me to actually booed up their expectations. Now there's an IC sort of, there's a number of different ways that agents do this in a functional way, but some then just go to ground and just refuse to entertain offers and just go stick their hands in the East. LA don't talk to me, don't tell, I don't want to know we're going to watch him. We're going to watch him without being told don't entertain any office, blah, blah, blah. And they never increased their quoting. Now I bought a property at auction a couple of weeks ago, and I put an offering during the campaign because I was trying to get them to increase the quantity.

Veronica Morgan: Cause it was so ridiculously low and I knew they weren't going to sell price. And he continued to quite less than what my written offer was. And his justification was, well, you know, my reserves lower than your offer. And I'm like, that's not the law. It doesn't matter. The fact is you've rejected my offer, which means you're not allowed anymore to quote less than my offer, but he didn't care. He just keeps doing it. And then you got the other, so that's one type. And so he didn't want the offer. He was avoiding me and all the rest of it. And I gave him the offer. Then at the other end of the spectrum, you've got those agents. So we'll actually they'll do the bait conversation. I think we've got someone talking about coming in with an offer on Monday and, and we're expecting that offer to be around X.

Veronica Morgan: And if all their buyers don't fall off, they go, excellent. I can increase the quoting to X and they'll do the process again and repeat, Oh, well now that buys you can come in with that offer that decided to go to auction, but I've got another one X plus one and not, no one's falling off. Great. So they ramp it up. That's they actually turn up in the pot, underneath the frog and you know, it's, and there they are at least doing their job in a bit more transparent, but it's still the dialogue around it. Isn't really honest. You know, so, and buyers have no idea that this is going on in

Chris Bates: Industry a lot more regulation.

Veronica Morgan: Well, let's see, these are the thing. I don't think the regulator there's loads of regulation around this. It's just the problem is that the agents and the buyers play there, it each plays a part in this game and it's a game. And so it's without understanding what's really going on. No one feels that they can be honest. And so, and I don't think regulation is going to sort that one out.

Chris Bates: Hmm. I mean, this is why I say we haven't, you know, used a buyer's agent you know, as a couple in the weekend and, you know have suggested they should. And they're not, which is fine. If not, I don't actually do the numbers on last year, but it's probably about 50 50, I guess. But definitely I try to help, but I'm always like, you definitely need to get around processing this AC Basel, think walk have what's on there for 900. So I'll offer a nine 65 and a bit less than 10%. And unfortunately, because there's not the knowledge there on, I had a prostate property, really what it's worth the market comparables totally

Veronica Morgan: What's purchased. The agent is following.

Chris Bates: And so this is making an offer, even a good idea, you know? And so all these sort of questions, they're kind of looking for a mental shortcut or a little rule book to play, and then you can always put this out in the marketplace. Unfortunately just doesn't work like that. Right. And this is so much, you know, every situation is differently how you approach it. What's actually a good price, you know, do you make one really good offer? Do you start low and

Veronica Morgan: Send them a link to my book, Chris chin, ready? How to buy property at auction, even though you're scared shitless that they're not scared enough.

Chris Bates: Reality is a lot of people probably wouldn't read the book, not because it's you, because the whole effort to go down and reading a book. And so when the sort of transaction, where are you in, if the knowledge is there, they just want to kind of get the deal done and kind of have this search. And so, you know, they'll potentially just try to make offers and they get themselves into that. You know, what's it mean once you've started the dialogue not going to end well as you've already started to a show that you don't really know what you're doing, and then the agents really go, okay, what tool should I use now? And so

Veronica Morgan: Exactly the people they get themselves into, it's just appalling and they don't even know that they've been played. And that's, that's the bit that it's, and these are smart people, smart, successful people get stuck in this loop. We could have a whole episode just on that. Yeah.

Kent Lardner: Got it. From speaking to agents knowing COVID and people were in lockdown and I was like, Oh, the agents just going to work straight through in January. And I'm like, well, everyone needs a holiday at some point five. It wasn't really a holiday. I E finding the love the agents, but still just going, walking every other year, shutting down January time.

Veronica Morgan: Yeah. So most stages, unless you're in a holiday area unless you're in a, in, you know, where they want to sell the ice cream liquors then typically agencies are closing. So their last day is often the 22nd of December. And they'll reopen on, I think it's the 4th of January, which is the first Monday after the the first Monday,

Chris Bates: I didn't really come on to straight. I knew, is that right? Or do you find me,

Veronica Morgan: Although some agents are saying, look, you know, they reckon that that January is going to be a lot harder this year, not just temperature, but in terms of a buyer activity, because most, you know, no one's able to go overseas, but I still think that people are going to take holiday. And certainly if you look on Airbnb, there ain't much accommodation left around the country. So I still think we might not be going overseas, but we are taking holidays. So we tend not to see the auction campaigns kicking off until maybe the weekend before Australia weekend or Australia is in the middle of the week, this year. So it'll probably be the last weekend of January that we'll see any true volume of, you know, any, any noticeable market or, or useful volume of stock, but there'll be trickled throughout that time of pre markets and off markets.

Chris Bates: And I guess just one tip for listeners is if you're thinking about buying early next year you know, especially right now is, is dying delay. The whole pre-approval process it's frustratingly challenging at the moment is no every bank's offering pre-approvals I, you know, even less every year seem to want to do them. There's a bit of a cost to the business that you're going to, that actually convert very highly versus actual purchases and refinances. So and a lot of them are done by computers. Now they're not actually done by a human. So if you want to get a real preapproval by human you've only got limited options. And the whole process, all the banks are really struggling with turnaround times and they're still very confused around responsible lending and, you know, I'm trying to credit assessors and it's a real nightmare at the moment to get pre-approved. So if you are thinking about doing something early next year, just get the ball rolling, you know, as soon as you can, because it could take some time

Veronica Morgan: We're paid, go God or boy scout motto. If you're not prepared, you will be caught out. And if you are repaired, you can still choose to do nothing. Yeah. Well, I guess we should wrap up our December, 2020 a suburb trends episode. Thank you again for joining us Canton. Thank you all for listening. We'd love to hear your questions and feedback. And also, you know what you'd like us to cover next year, Kent, we're looking forward to you joining us for eight February, 2021 suburb trends. We're going to have a holiday in January. I mean, much to talk about in terms of market movements. Cause most of the country sort of goes on holiday and there's a lot less transactions over that period of time. So, you know, we hope you have a lovely Christmas break and thanks again, Ken Christmas, Merry Christmas, Merry Christmas.