The latest CoreLogic Housing Market Sentiment Survey indicates that two-thirds of Australian’s think that now is an ideal time to purchase residential property. However, a significant proportion of those surveyed also believes that the housing market is vulnerable to change, which may prevent many from entering the market. This creates a paradox in market attitudes; one mortgage brokers aim to correct.
Some 2,430 Australian residents participated in the CoreLogic Housing Market Sentiment Survey, with more than 60% saying that they felt that now is a good time to buy a home. This is a four% increase on last year’s figures.
Respondents based in Sydney, where home affordability has risen, are not as optimistic as other respondents about property buying. Only 53% said they would consider purchasing a dwelling. However, 57% of regional New South Wales respondents stated they would buy now.
More than 80% of respondents based in the Northern Territory, Perth and Western Australia stated they thought now is a good time to buy property. This response is surprising given that these areas had experienced record levels of growth in home values before these values peaked, and then dropped.
Survey question: Is now a good time to buy property?
|Region||Yes %||No %|
|Australia Capital Territory||68||32|
|Regional Western Australia||84||16|
|Regional South Australia||76||24|
|Regional New South Wales||57||43|
Source: CoreLogic RP Data
|Age||Yes %||No %|
Source: CoreLogic RP Data
Economists are shocked that such a large number of respondents, almost two-thirds or 65%, said they thought home values could experience a correction in value. As while these results suggest that many respondents are concerned about the Australian housing market, this percentage is 10% less than 12-months ago.
However, many interviewees said they expected dwelling values to stay consistent. Tasmanian respondents are the most positive about the growth of home prices.
Of all respondents nationwide, only 38% said they expected home prices to rise over the next year. Twelve months ago, around 45% said they expected property prices to rise. CoreLogic economists suggest this decrease indicates that not as many Australians expect to make capital gains over the next year.
Of the respondents that felt that home prices would rise, which was one-third of survey participants, 6% said that they thought home prices would increase by more than 7.5%. Some 80%, however, stated that they expect home price increases to be less than 5%.
Tasmanian survey respondents are the most optimistic, some 44% indicated that they thought dwelling values would rise over the next six months. According to CoreLogic Data home values in Hobart have increased by around 6.2% over the last year.
Despite CoreLogic Data suggesting that the rental market is at its weakest in almost 20-years, only a small number of survey respondents (11%), are anticipating that rents will fall over the next year. Nationally speaking, survey respondents were equally divided as to whether rental prices would rise or remain steady over the next 12-months.
The majority of survey respondents say that rents will rise. The exception being Perth and regional Western Australian respondents who state that rents will fall. This expectation is consistent with rental statistics for this state which indicates ongoing rental falls across the state.
The highest level of respondents who feel that rents will increase over the next 12-months are in Tasmania (56%). More than 50% of respondents in Adelaide, and Regional New South Wales and Victoria feel that rents will rise.
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