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Property News Update: 31 May 2019

We’re back with Nicola McDougall and Kevin Turner as they discuss interesting property stories for this week.

According to experts, Australia’s shock federal election result may boost overseas real estate investments into the country. With a majority government, investors are regaining certainty in the market and real estate funds may choose to divert capital to Australia from less stable global investments.

Given that the U.K. is currently clouded with the Brexit, and the U.S. is engaged in a global trade war with China, Australia’s transparency, liquidity, and political stability stands out against its traditional capital rivals.

The immediate bounce back in the Australian share market should also have a positive knock on effect in real estate markets, says Marty Janes, head of Metropolitan Sales and Investments, JLL.

“Renewed business confidence will lead to greater business activity, with a flow-on effect on office leasing and values,” Janes says.

Swapping homes isn’t just in the realm of reality TV anymore. Two residents in Sydney decided to switch homes and do so permanently. Sophie Townsend of Glebe decided to downsize and put here Hereford Street home on the market, despite dreading the idea of an auction and the uncertainty of an imminent move.

Luckily, her neighbors, Sharon and Alex Veveris, attended one of the open homes and expressed an interest in her property. Selling agent Matt Carvalho then appraised the neighbor’s house and saw characteristics that Sophie was looking for.

"It's an absolute dream. It's been emotionally much better than it often is," Ms Townsend said. "Sharon and I have had a couple of coffees and it's been fantastic.” Mrs Veveris describes the transaction as a “unicorn sale” and says that both families have found new friends in the process.

Our third story is about the former home of a hitman, of all things. Notorious Chicago mobster Jack McGurn’s house is on the market in Oak Park. Jack “Machine Gun” McGurn is the alleged mastermind of the 1929 Valentine’s Day Massacre and one of Capone’s confidantes.  

McGurn lived in the bungalow at 1224 Kenilworth Avenue and the home is now a stop on a Chicago-area gangster bus tour. He lived at the house with his wife, Louise Rolfe.

Fellow mobster Tony Spilotro’s house was also sold recently in Las Vegas and the one-time home of Capone himself was just sold in Chicago.

Despite reports of a probable increase in the property market, there are also 80,000 reasons why the market will struggle to bounce back. The country is currently experiencing the worst housing slump in a generation and its spreading deeper into the economy.

“There are much less people attending our open homes,” says real estate agent Alex Chidiac. “If this was on the market two years ago, we would have expected at least 10 groups coming through on a Saturday. Now, we’re averaging somewhere in between 3 to 4.”

Nationwide house values are down an average 8% since their 2017 peak. The number is more than 14% for Sydney.

Australia's property obsession soured largely thanks to a self-imposed credit crunch within the nation's banks after they became the most exposed to housing in the world. A probe into the finance industry saw lenders become tougher on mortgage borrowers, especially for riskier investment loans. That may make them reluctant to increase lending, even if demand does pick up if interest rates are lowered.

Our last story for this week is about a former court house that has been turned into a 10-bedroom home. The imposing Grade II-listed former courthouse was built in a Victorian Gothic style in 1857 as a magistrates court and police station. The historic property is packed with original period features and spreads out over more than 6,600sq ft.

The former jail cells have been converted to bedrooms. They even still have the hatches that were used to pass food to prisoners and an original stone spiral staircase, which was used to bring prisoners to the courtroom.

The Old Court is 30 minutes from Bristol and Bath in Temple Cloud and has been listed for sale for £795,000 through Savills.

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