Two-thirds of Australians believe it is a good time to buy property, the highest figure since mid-2019, according to a new survey.
Many people have quickly shrugged off doubts about the property market, and are more confident in buying real estate than they were pre-pandemic, the national survey of more than 23,000 people, conducted each month by comparison platform Finder, found.
Image: Unsplash | Source: Finder
In April, as Australia was in lockdown and braced for what was expected to be the worst recession since the Great Depression, just 42 per cent of respondents thought it was a good time to buy real estate.
Finder’s international insights manager Graham Cooke said the public’s perception of the security of the housing market took a huge hit as soon as COVID-19 arrived in Australia.
“No one knew how deep this hole was going to be and its impact on the economy,” he said.
“But it was pretty quickly alleviated and now people are more enthusiastic about buying property than before [the pandemic].”
Source: Finder survey
The share of people surveyed who think it is a good time to buy property rose after the economy emerged from April’s national lockdown.
The survey also found those who expect property values to “somewhat increase” is up to 44 per cent, from lows of 18 per cent in April.
Mr Cooke said leading economists were even more positive about the economy and housing market than the public. All of the 40-plus economists Finder surveyed in December believed Australia would stay out of a recession in 2021.
“It’s very positive for the housing market,” Mr Cooke said. “All the lights are shining at the same time.”
After the doom and gloom of 2020, is there now a golden window of opportunity for buyers and sellers? Or, should one tread with caution when considering entering the real estate game?
CommSec chief economist Craig James said the outlook for property across the country was encouraging.
“At the moment, the interesting thing is, it doesn’t matter where you travel to, home prices are rising,” Mr James said. “There were only two out of 88 regions which recorded falling house prices last month, which is quite remarkable.”
But experts have warned the price of inner-city apartments, particularly in Melbourne and Sydney, could continue to fall this year if national borders remain closed, due to a drop in immigration and international students.
Mr James said there were two major factors at play in the property market: interest rates and job security.
“The Reserve Bank is basically saying the cash rate will remain steady for three years so that gives people a degree of confidence,” Mr James said. “I think that’s an encouraging aspect of whether you’re an owner-occupier or an investor.”
Australia’s unemployment rate was also expected to peak at a much lower level than initially anticipated.
“But the issue is we can never be too alert for changes in the economy, and in the health status of the nation,” he said, referencing outbreaks of coronavirus and the possibility of more lockdowns. We can never get too complacent until the bulk of the population is inoculated.”
There was also the risk of policy mistakes, he warned, particularly around the future of stimulus packages introduced last year to cushion the economy.
“If the Reserve Bank and federal, state and territory governments want to ease back on some of the support measures, they need to do so in a gentle fashion otherwise there will be fresh downturns in the economy.”
Rich Harvey, buyer’s agent and CEO of propertybuyer.com.au, cautioned vendors and buyers of “economic wobbles” in 2021.
“We’ll see difficult news and negative headlines,” Mr Harvey said. “But it’s about buyers understanding the bigger picture; property is a long-term proposition.”
The end of JobKeeper in the second quarter would probably have a “muted effect” on the property market, he said.
“Some commentators are suggesting there will be large volumes of mortgage defaults, but the evidence is very scant,” Mr Harvey said.
“My advice to buyers is not to rush, but don’t delay it either.”
For home-owners thinking about moving, he cautioned against waiting in the hope of snaring a cheaper property.
“As long as you’re not selling and then waiting to buy, thinking that the market is going to fall,” he said.
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