PROPERTY MARKET LOOKING GOOD
There are many reasons for cautious optimism when it comes to property market conditions.
Since 2003, house prices have continued to adjust and when you combine this with record interest rate cuts and state and federal Government stimulus packages, things are looking more optimistic.
Auction clearance rates in most capital cities have been up in recent weeks, and market experts are expecting the Reserve Bank will cut interest rates even further.
This is all good news for home owners and property buyers, as are other economic indicators.
Petrol prices are heading back towards a $1 a litre, immigration is still increasing and investment property returns are on the rise.
In addition, first home buyers have returned to the marketplace, consumer sentiment has risen 4.3 per cent in the past month and we have a dramatic shortfall in housing supply.
These factors point to an Australian housing market that is strongly underpinned and in a robust position to weather tough economic conditions. While the property market has been soft for some time, the “housing bubble” burst in Australia in 2003 and, unlike the United States, this country did not continue to build new property at excessive rates. Australian property and banking markets could not be more different.
It’s easy to get caught up in all the negative news but the reality is that for those who are able, it’s important to continue to live lives as normally as possible and not curtail spending which will cause even greater pressure and hardship on consumers.
