International Economics Consultants Say ‘No Major Correction in Prices’ for Australian Housing Market
Although plenty of media attention has focused on Sydney’s recent property market trends, international economics consultants BIS Oxford Economics says, in a recent exclusive report, Australian Housing Market should not be too concerned as a “major correction” is unlikely. While some turbulence is expected over the next 2-3 years, this is likely to be felt more acutely in major capital city markets like Sydney and Melbourne while, in contrast, cities like Brisbane and Perth are likely to experience growth as the property cycle turns in their favour.
Earlier Market Rebound Likely – Strong Underlying Upward Prices Pressure
In further good news for homeowners and property investors, the current market malaise is not expected to be a drawn-out affair with the report suggesting Sydney’s market could reach a turning point in the 2019/2020 financial year – and perhaps even sooner.
The report argues that, in the medium-to-long term, property prices are influenced by factors such as Australia’s overall economic performance, national levels of unemployment, infrastructure investment, population growth, and whether the nation is meeting its housing needs.
Several of these factors point toward a relatively quick rebound in the market. Although Sydney’s housing market is currently experiencing weak prices growth, the report suggests there is unlikely to be enough housing to meet demand over the period to 2020/21, and this will exert upward pressure on prices.
Population growth and infrastructure spending is also expected to play a part in fortifying prices in capital cities over the next three years. Low interest rates and low unemployment are expected to underpin market conditions, working against a property market prices crash.
Encouraging Signs for Property Investors
Vision Property & Finance Property Advisor, Matt Ivers, says investors have every reason to be encouraged by BIS Oxford Economic’s conclusions. Homeowners could also draw strength from the report’s findings, he says, with the market better positioned than recent media attention has led us to believe.
“There is always going to be a property cycle where prices fluctuate from local market to local market but the report highlights there are some fundamental reasons to be more upbeat about the Australian property market.”
“Strong public works spending, steady population growth, historically low interest rates which show little sign of budging, and relatively high unmet housing needs are all working to keep steady pressure on property prices.”
Good Opportunities Still Available
Matt says the report has confirmed his own findings when it comes to the opportunities for investors around the country.
“I have seen clients have success in the Brisbane market recently, and historically it is set to catch-up to Sydney’s roaring property market of 2017 and 2018 with long-term average property prices starting to move up in the Sunshine State. Combined with a new wave of population growth in South East Queensland, steady growth looks like it will provide opportunities for years to come.”
Southern States can’t be written off either, says Matt. There will always be pockets of growth, and regional markets have also been doing better than their capital cities over the past 12 months.
“The key for investors is to work out what their property goals are. If you are looking at building a solid portfolio there are opportunities out there. We just need to find them for you!”
To find out more about BIS Oxford Economic’s report and its implications for Australia’s property market and how it could affect your property investment plans, contact Matt Ivers at Vision Property & Finance on 1800 004 663.