Perched on the brink of yet another global economic meltdown, Australia looks set to once again come out smelling of roses while many of the big power players are left reeling in the wake of a second major recession.
The outlook for our local property markets is looking pretty good too say experts, who emphatically deny the existence of a price bubble that will see values nose dive in the near future.
In fact according to Aussie Home Loans executive chairman John Symond, demand for inner city apartments in Sydney should be strong throughout the spring selling season, with renewed buyer interest in the affordable end of the market.
“The recent state budget and its attendant stamp duty concessions should see demand rise for apartments in the lower price range,” Symond told Property Observer.
“New units located close to the CBD and public transport link will be the winners in the spring of 2011 – easily beating older units and homes,” he says.
“Also fuelling demand for units are empty nesters who are leaving their homes for townhouses or apartment living.”
Although Symond concedes that the Sydney real estate market has cooled, after multiple interest rates from the Reserve Bank last year saw many would-be buyers take a seat on the sidelines, he predicts that property in the sub $1million bracket will perform well in coming months, while those above a million will continue to be sluggish.
“More affordable houses and units will experience stronger demand as the First Home Buyers still receive State and Federal incentives to purchase,” says Symond.
“While dwellings within 15km of Sydney’s CBD have historically performed the strongest, we are now seeing healthy growth in the more affordable suburbs in Sydney’s west, such as Blacktown, and this trend should continue.”
He believes luxury homes will continue to languish on the market as prices stall and says the biggest concern for the Harbour City is a notable lack of affordable housing potions.
“The supply of new rental properties continues to be slow, leading to an acceleration in rents – creating further pressure on those who are keen to get into the property market for the first time,” he says.
“Many young people are now effectively priced out of Sydney property ownership and face accelerating rental payments. This problem of affordability should be urgently addressed at both a federal and state level, with new housing lots and units required.”
Symond says despite these issues, there are still “opportunities for the astute purchaser who does their homework, as there is a strong prospect of lower rates over the next few months”.
“Banks continue to favour home lending over small businesses and commercial lending and that will fuel growth.”
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