2018 Property Predictions & Trends
Buyers agent, Simon Cohen shares his thoughts on the 2018 Sydney, Melbourne and Brisbane property markets, and the trends that are likely to dominate this year.
The past year has been an interesting one for Australia’s property market. Continued strength, even over the winter months, gave way to a slight softening as temperatures began to rise around the country. It may not have been enough to put off many buyers, but it certainly gave investors and those who work in the industry pause for thought.
With the most recent figures showing auction volumes decreased to a 64.2 per cent preliminary clearance rate across the combined capital cities, 2018 promises to be a year of possibility for buyers equipped with the knowledge, expertise, and insight necessary to make the right purchase.
A cursory glance at the Melbourne property market may set alarm bells ringing. Price increases have been slowing since spring, with decreasing auction clearance rates indicating a drop in demand. This, combined with a 158% growth in apartments pinned for approval, gives the impression of an area softening significantly.
However, with the drop in overseas investment impacting Melbourne less than it will Sydney, an undersupply of houses and older apartments, and a new rail link promised, prices are set to remain stable among some of the most desirable areas of the city.
In Sydney, one of the world’s hottest property markets shows little sign of cooling off further. The slight lull in the second half of 2017 is likely only to shift the identity of buyers, rather than reduce the number. First home buyers will start to re-enter the market as investors consider their purchases more carefully, but with limited stock and consistent demand prices, clearance rates are set to remain strong.
Sydney’s infrastructure boom continues to contribute to a strong market. The NSW government recently upped its infrastructure spending from $72 billion to $80bn over the next four years, and the impact on Sydney property is clear to see, particularly in areas where the investment has the most impact.
While Melbourne and Sydney continue to be largely predictable markets, Brisbane is set to see significant events and changes in the new year. As the population continues to grow, and approval of units almost completely ceases, the city is likely to see rising prices. Buying units now – contrary to what many media outlets are reporting – will prove a sound investment.
With the Commonwealth Games arriving on the Gold Coast next year, the infrastructure, tourism, and attention are all likely to boost the local economy and make the area even more attractive to buyers. While potential investors should be wary of being caught up in short-term trends, the Gold Coast looks set to remain an excellent prospect into 2018.
With a tighter focus on lenders and the rising cost of new interest-only loans, there is more room around Australia for first home buyers to find success in 2018. No matter where you might be looking to buy, or what year you’re looking to buy in, the same fundamentals apply.
Tips and tricks like buying around newly established school zones, considering physical and social infrastructure investment, and enlisting a professional with knowledge of the market and the key players within it will always be relevant, and shouldn’t be forgotten as markets shift.
Happy New Year, and Happy Buying!