Aussie Love Affair with Property Still Going
According to a recent survey three quarters of respondents said they intend to purchase property in the next five years and almost 30% are looking to buy in 2011.
The annual QBE LMI mortgage report is a survey of 864 mortgage holders and people looking to get into the property market over the next five years. The study was held in February by market research company CoreData.
While some see the market as overvalued, there is also a fear that waiting to get into the market will ultimately be more expensive as prices continue to rise.
It appears there is a strong appetite for property in the short-to-medium term Australia-wide, with 74% of respondents saying they intend to purchase property in the next five years and 29% intending to do so by the end of 2011.
Thirty-nine per cent of respondents said property prices would be higher in 2011 than they were in 2010, while 25% expected a pullback. Thirty-three per cent expected no change.
Just under 60% said property will increase in price strongly over the coming three years.
Seventeen per cent of respondents see property as an effective way to build wealth quickly and despite the highly publicised property market crashes in the US and UK during the GFC, only a small fraction (13%) believe that property can be a risky investment, according to the report.
Younger respondents and owner occupiers were more likely to report mortgage stress than older people - 31% of Gen Y reported mortgage stress versus 26% of Gen X.
Less than 20% of property investors reported mortgage stress versus 26.9% of owner occupiers.
The survey's findings suggest mortgage holders are feeling the pinch from the string of rate rises over the past couple of years and rapid appreciation in property values requiring mortgage holders to borrow larger amounts of money.
Sixty-three per cent of respondents described the market as 'overvalued'.