Spring heralds the start of a new housing
season, and those ready to make a move
will find it to be a buyers’ market.
Spring has sprung
The grass has rizz
I wonder where
The flowers is.
– Melvin Hergenroter.
It’s springtime! The days are
getting warmer, and longer, and while
there’s still a nip in the air,
nature is on the move. Green shoots and
new leaves are signs of the budding growth
underway. It’s time to waken from
the dormancy of winter. Stretch, rise
and shine, as a new season of growth
and opportunity awaits.
In the property market, spring is traditionally
when the starter’s gun is fired
to bring on the new season. 2010 is set
to be no different, with plenty of properties
lined up for sale, while the auctioneers
gargle and tune their throats for the
busy period ahead.
What can you expect to find this spring?
In our view, you are going to see a real
buyer’s market that has its origins
in:
-
A steady reduction in the number of
home loans granted over the past
12 months
- A corresponding increase in the
number of properties available
for sale
- Mortgage rates that have climbed
by 2% over the past year
- The winding down of government
stimulus
- Flat business profits
- Uncertainty regarding the state
of the world economy
- A flattening of property price
growth after a hectic ride through
the GFC
- Uncertainty in the wake of the
2010 election
However, does this not spell ‘opportunity?’ In
your opinion, when is it the best time
to buy property? When buyers are jumping
over each other and outbidding one another
to buy anything, at any price. Or in
circumstances like we are likely to find
this spring, when all the pent-up demand
and emotion have been stilled by the
factors mentioned above, and when you
can shop around and negotiate good deals
on the property of your choice, and the
mortgage that goes with it?
For a clue, look to those investors
buying investment property right now.
Loans to investors are at three-year
highs, and almost one in three property
sales is to an investor. In contrast,
first-time buyers have retreated to the
sidelines.
So while we have a buyer’s market,
with smart investors at the front of
the queue of those who are buying, have
the fundamentals of property changed
in any way?
Again, in our view, the answer is a
resounding ‘No.’
We are still:
- Short of 200,000 housing
units nationally, which shortage will
continue to grow
- Jobs growth is extremely
strong
- Unemployment is at near historic
lows
- We will see still welcome
high numbers of new migrants
-
There won’t be any changes
to the attractiveness of investor
tax
benefits
such as depreciation allowances
and negative gearing
- Owning your own property
remains a cornerstone dream in the
Australian psyche.
So this spring, why not rise up from
winter’s slumber, and embrace the
season of new growth and opportunity.
You’ll find conditions to be mild
and pleasant, and ideal for planning
and implementing an investment property
strategy that can help provide for your
future needs.
If you would like to learn more and
discuss how McCarthy Group can assist
you, click
here.
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