Market has hit its peak
THE property expert who first tipped the incredible rise in Geelong’s real estate market has given hope to homebuyers who believe they’re being priced out.
Hotspotting founder Terry Ryder said he’s seen plenty of evidence that Geelong’s property market is approaching the peak of its growth cycle.
Mr Ryder said new research published in the latest Hotspotting Price Predictor Index showed the trend for quarterly house sales in several Geelong suburbs had plateaued.
He said Ballarat and Bendigo had overtaken Geelong as the best areas for future price growth in Victoria.
Mr Ryder said price growth in Geelong might plateau, with a chance of a minor price correction, but the report still lists the region as one of the nation’s best growth markets.
Armstrong Creek, Bannockburn, Bell Post Hill, Clifton Springs, Drysdale, Hamlyn Heights, Herne Hill and Mount Duneed are classi- fied as growth markets, while suburbs with hot prices today, like Corio, Norlane and Newcomb are among 13 where sales have plateaued, the report shows.
“Geelong was the first of the regional areas to get on a growth path. Geelong has a very strong and proven economy and real estate has been on a growth path for a couple of years now. Until recently it was the strongest in Victoria,” he said.
“But now we’re seeing evidence that it’s probably reached its peak. I would ex- pect that over the next 12 months the rate of growth will start to diminish.
Mr Ryder said there were a number of factors at play, including affordability. “When prices grow a lot, more and more people can’t afford those prices and eventually you hit an affordability wall.”
Tighter lending conditions were also hitting investors.
Maxwell Collins, Geelong, director Nick Lord said the level of growth in the past two years was not sustainable and should level out in the next 12 months to two years.
“I think there are some great opportunities for vendors as the market is performing very well and we’re not at the peak yet.
“But it will give some confidence for buyers that if they turn up to auctions, they are probably going to face less competition then what there may have been last year.”
Mr Lord said buyers entering the market now will probably look for suburbs which they see as undervalued, like Grovedale and Marshall where there has been a surge of interest.
The report ranks Corio among the top 50 growth suburbs and Lara among the 50 most consistent areas to buy in Australia.
New CoreLogic data shows a slowing rate of capital growth in several suburbs, including Geelong West, Belmont, Highton, Manifold Heights and Bell Post Hill compared to late 2017.
But the rate of annual capital growth remains above 10 per cent in the majority of suburbs.