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You’re looking forward to finally receiving the keys to your new house, bursting into the foyer and whispering to yourself “home sweet home.”
The question is, is this a true possibility for you in the current Australian housing market?
Unfortunately, Australia has been dealing with a struggling economy and the worst real estate slump in about 40 years, and this has no doubt created a few losers. Fortunately, it has also created some winners.
Here’s a rundown on the recent trends, happenings, and predictions for the Australian housing market — and what you can expect as a home buyer in 2019.
Let’s get started!
New Home Buyers and the Australian Housing Market
The great news is that the economic downturn is making it easier for Australia’s first-time home buyers to afford homes.
These first-time home purchasers include younger individuals who previously feared they wouldn’t be able to afford homes after prices increased by up to 75% a couple of years ago.
Right now, interest rates are still close to record lows. In addition, lending curbs are keeping investors at bay. As a result, more home buyers are pursuing mortgages and buying homes.
The takeaway? Now is an ideal to buy a home in Australia if you have a stable job, financing and a deposit on hand.
Likewise, it’s a smart time to build a home, which provides most flexibility to own the home of your dreams. However, compared to a built home purchase, construction loans are stricter and subject to successful progress when building a home. That’s why it’s particularly important to select a reputable builder like GJ Gardner Builders to ensure your building project finishes on time and within budget.
With more people buying homes in Australia, fewer people are renting properties. And this has sparked a new wave of supply in the real estate market.
As a result, rent prices are starting to go down to Australia. In fact, many landlords are offering incentives, like cases of beer or free pizza to applicants who agree to sign their leases right away. Others are offering free rent for a week.
The takeaway here? Australia’s rental market is more of a tenant’s market than a landlord’s market in 2019.
The first property you buy doesn’t have to be the first one you live in. More and more first home buyers are choosing to have their first property as an investment property while continuing to rent elsewhere. It’s one way for first home buyers to have the flexibility to live where they want to, perhaps somewhere they can’t necessarily afford, while getting a step onto the property ladder.
However, there are still stresses involved. Especially being both a homeowner and landlord for the first time, it’s easy to underestimate costs, from repairs through to loan repayments, strata levies, utilities, landlord insurance and property manager charges.
Given the risk involved with meeting all these obligations while still paying rent, it’s definitely not for everyone. But for people who want to get into the market while living the lifestyle they want, it’s something to consider.
Melbourne and Sydney are two large municipalities that led the nation’s housing boom. Now, the opposite is true, with these cities leading the housing retreat.
Rather than flocking to these cities, more Australians are pursuing homes in smaller cities, where houses are generally more affordable.
Future Economic Prediction
The current economic downturn is no doubt dramatic. However, housing prices should still move upward over the next several years.
The reality is that Australia has experienced recessions in the past, yet the market has always risen afterwards. In other words, dips and dives followed by good performance are the norms.
So, individuals in Australia should feel optimistic about the present, thanks to its current low-interest rates, inflation and unemployment. And they should feel even better about the nation’s economic future.
How We Can Help
In addition to highlighting the current trend with the Australian housing market, we offer updates on a wide range of lifestyle-related topics.
For instance, we examine how low-interest mortgages may be affecting the real estate market. We also provide tips for those who are thinking about moving abroad.
Take a peek here to find out more about how you can live your best life in today’s constantly evolving world.