Is now the time to invest in property?

Tanya Sale,  chief executive,  outsource financial

At the beginning of 2019 with house prices falling in a number of the capital cities, some may have thought it would be a good time to jump back into the property market.

However if you consider the months that followed, the easing and intensity of the falling market have been like a roller coaster rather than a steady decline.

A daily home value index created by Core Logic showed house values deteriorating at a mixed pace. There were times when prices in Sydney were falling that rapidly that if the decrease had continued for 12 months, values would have diminished by a quarter.

Whilst data can provide an indication of what has occurred it is not a crystal ball showing us the future.

To consider the question of whether prices will fall there are a number of factors to contemplate:

  • There has been a boost in confidence ignited by the surprise election victory by the Coalition.
  • The Australian Prudential Regulation Authority (APRA) has proposed lowering the interest serviceability rate that Lenders utilise when assessing a borrower’s affordability.
  • Recent Reserve Bank of Australia interest cut.

However another faction suggest the cut was due to the weakness of the economy, an increase in unemployment and a record-low credit growth.

Additionally with household debt being higher than ever before there still may not be a great eagerness for people to purchase properties.

Really – Anything could happen. What's important is that Australians looking to get into the property market should be connected with financial advice.


The opinions expressed in this content are those of the author shown, and do not necessarily represent those of No More Practice Education Pty Ltd or its related entities. All content is intended for a professional financial adviser audience only and does not constitute financial advice. To view our full terms and conditions, click here.

 

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