Recent press has painted a picture of doom and gloom regarding property prices rising. Some forecasters have predicted falls up to 40% in property prices. Mortgage broker What If We Finance believes these predictions are slightly exaggerated. Property prices are set to rise again.
Property prices have stabilised or fallen slightly but there are multiple segments in the property market and each segment is experiencing different levels of growth.
The $600-$800k segment has been strongly supported by first home buyers and has seen strong demand. Prices have not been growing astronomically like a few years ago but there has been considerable activity and turnover. Anecdotal feedback suggests some properties are exceeding their reserve and not being passed in.
Research by the Domain Group is predicting at 2019 property prices will stabilise and in the later half of the year begin to rise again.
Melbourne property prices are expected to grow around 4% on average after some of the largest falls in years. Remember we did have years of very strong growth.
2018 saw a number of factors dampen property prices and these included tighter bank lending, regulatory changes and investor caution.
The re-emergence of first home buyers’ continued population growth and expected wage growth will translate to greater support of property prices rising.
The elephant in the room is the Labor Party’s proposed negative gearing changes. This may dampen property prices in the short term 6-12 months.
Despite all the uncertainty property is expected to continue rising and growing in the medium term and now is a great time to enter the property market. Predicted changes in the market by the capital city are:
The evidence is suggesting property prices will begin to grow again and now is a good time to consider entering the market.
Your mortgage broker can work with you to navigate the lending landscape and more importantly simplify the lending process for you.
Contact What If We Finance today.