Australian Property News

Spring selling season could bring investors back

Posted on Tuesday, August 24 2010 at 5:45 PM

The property market's spring selling season is just around the corner and it's not expected to be hampered by any possible lag effects from the hung parliament.

"According to RP Data, seasonally, Australia typically sees higher than average property activity from September through to November," says Mortgage Choice senior corporate affairs manager Kristy Sheppard.

She says this year should be no exception to that trend and it might be the time for investors who have been holding back until after the election to get back into the market.

"There are already more properties on the market than usual at this time of year, which is good news for prospective investors, as is property prices plateauing in many areas and dropping in some, rental prices increasing, strong population growth continuing, consumer sentiment rising and the sharemarket continuing to be unpredictable," says Sheppard.

The latest Australian Bureau of Statistics (ABS) housing finance report saw the value of investment housing loans drop for the first time in four months in June 2010 by a seasonally adjusted 3.6 per cent to $7.3 billion, the lowest value reached since February this year. However, this compared favourably to $6.5 billion in June 2009.

With housing undersupply still a major issue in Australia, especially with recent ABS building approval figures showing a fall for the third consecutive month in June, Sheppard says the long-term potential of property is believed to be excellent.

"With fewer new properties there is bound to be a pick up in rental price growth, which we've already seen," she says.

"Australian Property Monitors’ Rental Market Report for the June 2010 quarter shows from April to June rental prices for houses rose nationally by 0.7 per cent, bringing annual growth to a small but encouraging 3.1 per cent."

"The unit market was stronger, with rents increasing nationally during the last quarter by 3.5 per cent, bringing the annual growth rate to 4.2 per cent."

"This bodes well for people who research the property market thoroughly, have a long-term strategy in mind and investigate all their finance options so they make a sound investment decision."