CoreLogic & TEG Rewards latest housing sentiment survey concluded that almost 70% of Australians think now is a good time to be buying a dwelling, despite dwelling values moving out of reach for many as the housing market broadly approaches four and half years of growth.
Survey respondents in Sydney were a little more pessimistic, however 52% of Sydney respondents still felt it was a good time to buy a property.
That figure rose to 73% for those in NSW which is probably why we’re starting to see higher sale prices for regions like the Central Coast as demand becomes higher and stock levels are low.
Experienced property buyers leading the way
Interestingly, older Australia’s were more supportive of buying a property or home now with 74% of 56-65 year olds ticking the buy now box. Only 52% of 18-24 year olds thought now is a good time, which is certainly reflective of the tougher conditions for First Home Buyers.
With more experience and time under their belt, older Australian’s tend to be able to spot the right time to get into the property market. They tend to use their gut instincts and experience to judge the property hot spots and entry times.
59% of this group also indicated that they think property prices will either remain stable or fall.
92% believe that foreign buying activity is placing pressure on Australian home values
Unsurprisingly, Sydney and Melbourne showed the highest proportion of respondents that thought foreign buying activity was placing ‘extreme upwards pressure’ on home values.
However, in 2015, 20% of respondents indicated they thought foreign buying activity was exerting extreme upwards pressure on housing values. By the September quarter of 2016 this had halved to 10%. The reduced level of concern around foreign buying activity may be attributable to the recent tightening in lending policies for purchasers earning their income offshore.
70% of Australians think now is a good time to buy
The changes that APRA made to home loan and property investment lending for foreign buyers has not only reduced the volume of foreign buyers, but the changes have been reflected in the sentiment of Australian buyers less fearful of home values increasing.
Personal finance position key to buying a property
When considering what factor is most important when making a property purchase, half of survey respondents indicated it was their personal financial situation.
As mortgage brokers in Sydney and on the Central Coast, personal finance position has become even more crucial to securing a home loan or investment loan. With interest rates low and credit policy tight to stem the increase in property investors, it’s never been more important for buyers to come from a strong financial position.
When property prices, particularly in Sydney go bananas, lenders restrict home loans and investment loans by stressing the repayments and reducing borrowing capacity of buyers, making it harder to secure finance. This is why a strong personal finance position is essential to secure finance for your property.
Mint Equity works with buyers to not only find the right lender for them, but work out the best way to structure the home loan or investment loan for a greater chance of approval.
Reference: Australians share mixed views on housing market