Why the property market looks more positive
POSTED BY John Ireland ON 16 Dec 2020
Is the housing market about to lift and return to normal? There is certainly more positivity around now that the Federal Election is behind us and the RBA has cut interest rates. With confidence restored, property investors and home buyers are coming back into the market – so home sellers should do the same.
Here we give you our property market forecast for the remainder of 2019, what the positive signs mean for you, and how you can take advantage of the lifting market.
Australian property market outlook
The Australian property market is showing definite signs of recovery after its recent downturn. This is due to a combination of different factors, including:
- Tax cuts, lower interest rates and relaxed lending criteria
Income tax cuts are planned for June 30th, along with the possibility of interest rates potentially being cut even further in 2019. In addition, lenders are relaxing their criteria for home loans.
These measures are big news for the real estate market for a number of reasons:
- Income tax cuts mean that people get to keep more of their wages, so they have more money in their pockets. This increases consumer confidence and increases growth, as people spend more, so there are more dollars being pumped back into the economy.
- Lower interest rates result in people’s mortgage repayments being lower. This helps to stimulate the economy and also makes home loans more affordable.
- Relaxed lending criteria offers greater lending capacity, which will empower home buyers and investors to buy property.
- First home buyer incentives
There are new measures coming in to help more Australians get onto the property ladder. These measures enable approved applicants to take out an additional loan amount to cover the difference between the amount of deposit the first home buyer has, and 20 per cent of the value of the property.
This scheme will eliminate the need for mortgage insurance and allow first time buyers to purchase properties faster, driving growth in the real estate market.
What the experts are saying
Leading economists and property market experts have been expressing positive opinions about what these measures mean for the housing market:
House prices are already settling in many parts of Australia rather than continuing to fall. This shows that the housing market is recovering and house prices are likely to start rising.
Property auction clearance rates are already improving compared to the same time last year. This shows buyers are feeling more confident and properties are selling more quickly.
More home loans are being approved by lenders, particularly for first time home buyers, increasing the number of potential buyers in the market.
If interest rates are cut again this year, experts predict this could result in up to a 28 per cent growth in the housing market, as mortgages will be cheaper. Default rates are already starting to fall.
Is now the time to sell?
Traditionally, there are fewer properties on the market in Australia during the winter months than at any other time of year. This means listing your home in the winter is an ideal way to make it stand out, as most people choose to list their properties in the spring.
Home buyers are active all year round, and with the current financial market making it easier for them to get home loans, many will be looking to buy more quickly. This can result in more competition for your property as there are fewer on the market in winter, enabling you to achieve a strong sale price.
In addition, if you sell in the winter, you are in a powerful position, as you will have a competitive edge by being ready to buy in the spring. This is a sound strategy if you want to get settled quickly and get on with your life.
Stay on top of all the property market latest news
If you are a home seller or buyer and want to stay on top of the real estate market ensure you engage an experienced agent to help guide you through the process. Stay in touch with us. We keep our fingers on the pulse of the local housing market and are always happy to provide you with the help and support you need.
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As Principal of Bespoke Property Co in Avalon Beach, I’m passionate about both running the real estate agency and being an active selling agent. Combining my extensive property background with a commitment to providing a premium service, I offer home sellers and property investors in-depth advice, such as low-cost home improvements to strategies that will maximise your sales result. If you are looking for a down-to-earth, passionate and detail oriented real estate team, let’s connect!
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