The market is shifting
Have you been attempting to purchase your first home, but found yourself constantly pipped at the post? You’ll be happy to know that there is a change in the air.
September 1 saw the beginning of spring, what is often considered the ‘selling season’. True to form, figures from CoreLogic RP Data show that September saw the largest number of new listings across Australia since March 2015. The increased supply has had a significant effect on the market - for
instance, values grew just 0.1 per cent in Sydney for the month.
CoreLogic RP Data’s Head of Research, Tim Lawless, noted that while vendors are still benefiting from favourable conditions with demand exceeding supply, the tide is indeed beginning to turn.
“The slower month-on-month reading across the Sydney market comes at a time when auction clearance rates have slipped to the low 70 per cent range from week-to-week and the number of advertised properties has risen,” he said.
Mr Lawless stated that around Australia, the costs of property are becoming more favourable for first home buyers.
“The number of auctions held over the month of September was 31 per cent higher compared with September 2014 and new listing numbers are ramping up at a faster rate than last year as well,” he said.
Bank lending restrictions taking hold
The Australian Prudential Regulations Authority recently announced an increase in the amount of capital required to take out a mortgage from the major banks. In a September 26 article from Domain, Clare Rutledge, head of Urban Living by LJ Hooker, affirmed that the restrictions are beginning to make an impact, with first home buyers showing more confidence. “The effect of the new bank lending rules is starting to trickle down and investors aren’t so heavy on the ground now,” she said.
Record low interest rates remain
“Low interest rates are acting to support borrowing and spending,” said RBA Governor Glenn Stevens. This essentially means home loan repayments are easier to manage for first time buyers, particularly when first home owner grants (these vary state from state) and the aforementioned factors like increased affordability are added to the mix.
Talk to you local LJ Hooker office today about how you can use the current conditions to enter the market.