Most still feel now’s a good time to buy

Most still feel now’s a good time to buy

Posted on Friday, July 24 2015 at 1:51 PM

A majority of survey respondents think it’s a good time to buy property despite rising capital city home values over the past three years according to the CoreLogic RP Data Nine Rewards Consumer sentiment survey, released today.

Over the June 2015 quarter, 60 per cent of
respondents agreed that now was a good time to buy a property or home, though
this proportion fell from 71 per cent of respondents at the same time a year
ago, and is down from 80 per cent over the second quarter of 2013.

CoreLogic RP Data research director Tim Lawless says
a majority of respondents still feel that it’s a good
time to buy property.

“With the current growth period having run for
so long it isn’t a surprise to see a fall in the proportion of respondents who
think now’s a good time to buy, particularly in the hottest market – Sydney.”

The regions where survey respondents were most
optimistic about buying conditions were in Tasmania, regional South Australia,
Brisbane and in regional Queensland.

This comes as no surprise to Lawless, who says
these regions are yet to see a substantial run up in prices. 

Conversely, he says, “Sydney and regional New South
Wales-based respondents were the least optimistic about buying conditions,
which can probably be attributed to the high rates of capital that have been
recorded over the past few years.”

Sixty-five per cent of respondents thought it
was a good time to sell; the highest reading in the history of the survey,
which began in the first quarter of 2013.

Sydney and Melbourne-based respondents were the
most optimistic about selling conditions. Given the strength of the housing
market in these cities.

“Perceptions around selling conditions in the
Northern Territory and Perth, where property values are now in decline and
listing numbers are rising, were more subdued,” Lawless says.

The survey also asked respondents about their
expectations for capital growth over the next six and 12 months. Forty-eight
per cent of respondents expect home prices to rise over the next six months,
while 45 per cent are expecting prices to rise over the next 12 months. Only 14
per cent of respondents expect prices to fall over the coming year.

Respondents in Tasmania were the most optimistic
about the likelihood of capital growth for their state, with 60 per cent
expecting prices to rise over the coming year. 

Lawless believes this result confirms an
improvement in local sentiment across Tasmania, where the market’s previously
recorded weak conditions but has recently started to show some capital gain.

Sydney and Melbourne also saw more than half the
respondents indicating that they expected further growth in property prices
over the next 12 months.

Across the country, respondents from regional
Western Australia were the most pessimistic about local housing market
conditions, with only 14 per cent of respondents indicating they expect prices
to rise over the next 12 months.

Lawless says: “With attitudes around future
capital growth broadly still strong, it’s interesting to note that when
respondents were asked whether Australia’s housing market was vulnerable to a
significant correction, three quarters of respondents felt that it was. This
was the highest reading we’ve received for this question, which suggests that
despite a perception that prices will still rise, more Australians are becoming
concerned about a correction in the housing market. 

“Respondents based in regional Western
Australia, the Northern Territory and Sydney were the most wary about the
market’s vulnerability, with 86 per cent, 80 per cent and 79 per cent of
respondents respectively indicating they were concerned values could fall
significantly.”

Another aspect of the market surveyed in June
was respondents’ perceptions around foreign buying. When asked if they thought
foreign buyers were making it more difficult for those living in Australia to
own their home, 73 per cent responded yes. 

The effect of foreign buying was perceived to be
most evident in Sydney, regional New South Wales, Melbourne and Tasmania, where
are least 79 per cent of respondents thought foreign buyers were making it more
difficult for Australian residents to purchase their own home.

 

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