Queensland capital properties head back towards affordable
A leading market analyst has said that the slowdown experienced by Brisbane's residential property is not likely to be lifted by a string of interest rate cuts.
Senior researcher at RP Data Cameron Kusher told the ABC on December 27 that while the last two rate shifts by the reserve bank could help to bolster the market, it was unlikely to result in an immediate return to previous levels.
Kusher asserted: "Obviously the rate cuts will help; I don't think we are going to see values take off again like they did in 2009 after the Reserve Bank started cutting interest rates, but I also don't think that interest rates will go as low.
"I think the rate cuts will result in a little bit more sales activity but I don't think that's necessarily going to result in values starting to decline once again."
One of the key factors at play in this theory is that the initial slowdown was not caused by disinterest from sellers or buyers, but rather from a gap in affordability that saw Brisbane's housing prices drop by 2.4 per cent for apartments and 8.8 per cent for free-standing homes.
"After a long period of outperforming the national market, prices got stretched and people weren't prepared to pay those prices," said Kusher.