TIME TO BUY
HOME PRICES TO RISE AGAIN SOON
IT’S a buyer’s market but home seekers have been warned they may only have a small window to purchase properties at lower prices before they rise again.
Housing experts revealed many property markets were on track to rebound in the months ahead following record price falls over the past year.
The main drivers of the lift in prices over the second half of the year were worsening housing shortages, rampant migration and runaway rental increases coaxing more first homebuyers to purchase.
Agents reported buyers had also adjusted to the initial shock of the Reserve Bank’s recent barrage of rate rises and were factoring future rises into their spending budgets.
My Housing Market economist Andrew Wilson said the market was already improving and looked likely to bottom out by June.
Ray White chief economist Nerida Conisbee said there was mounting evidence the worst of the year-long housing slump had passed.
Prices nationally inched down by just 0.09 per cent over January and by a similar margin over December – a far cry from the more than 1 per cent drops over the months following the first rate hikes in May.
Ms Conisbee said rate rises had pushed down prices but their impact on future price movements had been overblown.
“It’s a big influence on the market, but it’s not the only factor,” she said. “Little housing stock is coming on to the market in most areas and this doesn’t look like it will change. In fact, it could get worse because we’re not building enough new homes and builders are going bust.”
Property figures showed current listings across the country are about 30 per cent below the five-year average. Three- and four-bedroom houses were in particularly short supply.
“The quality homes are rarely listed. Buyers who want them have to compete and prices will go up,” Real Estate Buyer’s Agents Association of Australia president Cate Bakos said.
“There are a lot of people who can buy, but aren’t doing so,” she said. “They’re all for the bell to ring saying it’s the bottom of the market. Those buyers will be your competition when the market recovers. The exact same thing happened during the pandemic. People held off until the market started booming, then it was too late.”
Buyer’s agent Rich Harvey of Property Buyer said sitting on the sidelines waiting for further falls in property prices before making a purchase wasn’t a smart strategy given how rapidly rents were rising.
A typical capital city tenant is spending about $30,000 a year in rent and some would not necessarily get this kind of saving on their purchase price if they kept waiting to buy.
First homebuyers Sam NielsenTuck and Christie-Anne St Guillaume said they debated whether to wait for prices to fall further, but realised taking this path didn’t stack up.
“Our rent wasn’t cheap and we knew it would keep going up,” Ms St Guillaume said. “We thought, if we wait too long we will miss the chance to pay off more of our loan.”