The future of the Australian housing market in particular is looking up with signs of a recovery in the residential sector already underway, Especially in Sydney. Opinions are positive, most notably in respect to the east coast residential market with Brisbane, the Sunshine and Gold coasts, Sydney and Melbourne all predicted to experience residential upturns.
Several factors have been identified that support this growing opinion. An undersupply of new housing stock has been referenced, especially in Queensland and NSW. Each of these states shares respectively 21% and 25% of the overall Australian market.
Declining interest rates have played a marked role in the perceived recovery. Once the election period is over, investors are tipped to seek opportunities alternate to money in the bank and the associated declining interest returns.
As housing prices recover and continue to increase more Australians are expected to be attracted to the tax advantages of property ownership. Figures indicate that the current price of Australian property is some 20% cheaper than it was as little as six months ago.
A recent influx of overseas buyers has also been associated with signs of a recovery. A recent NAB survey showed that foreign buyers of new Australian properties have doubled in the past two years.
Population growth supports the notion of recovery as demand increases. Last year alone around 400,000 people were added to the Australian population. Our rate of population growth has increased 25% in the past two years.
A number of other key factors support the belief of a residential market recovery including; lower volumes of stock listed for sale; less private treaty discounting; reduced listing times for property on the market and increased sales volumes.
Consumer confidence above all else has been essential, and an ingredient for recovery that has been missing for some time. Several successive rate cuts, along with easing of loan restrictions and improved affordability have raised consumer confidence and directed sentiment towards purchasing residential property.