2018 outlook shows soft landing for housing boom
18 December 2017
Australian home owners should remain confident 2018 won’t bring a sharp downturn in property prices, despite a slowing market.
Increased supply and reduced demand from investors will weigh on the property market in the new year, but according to Suncorp Chief Economist Steven Milch, this will be more of a soft landing rather than a housing crash.
“Low interest rates, falling unemployment and solid population growth are all still fundamentally supportive for housing – it’s just more balanced than in recent years,” Mr Milch said.
“We’re continuing to see slight price increases nationally, with the latest CoreLogic figures showing a 0.2 per cent increase over the past three months, and growth recorded in most cities outside of Sydney.
“For first home buyers, the slow down should assist affordability as house price growth comes more into line with income growth.”
Suncorp Executive General Manager Stores & Speciality Banking Lynne Sutherland reminded prospective home owners to consider their personal circumstances above all else.
“While it’s a good idea to watch trends across the property market, the best time to buy a home is when you can afford it,” Ms Sutherland said.
“Focus on saving a solid deposit – first home buyers can now take advantage of the new First Home Super Saver Scheme to help with this. Use online calculators to understand what your mortgage repayments would be and how it will impact your budget and lifestyle.
“The property market will always cycle through peaks and troughs, so it’s important to treat home ownership as a long-term investment.
“Home buyers can take advantage of current low interest rates, but ensure you can continue to make repayments if your situation changes.
“Do your research and check the median house prices in the areas you’re looking to buy.
“For first home buyers, you may need to buy outside of the city, so check what facilities are in the area that help make it an attractive investment. For example, proximity to public transport, schools or higher education, and projected infrastructure projects that are in the pipeline.
“You may also like to look at the demographics and population growth to understand future demand in the area,” Ms Sutherland said.
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