Australia’s housing market has slowed in recent months amid faltering auction clearance results, slumping new home loans and falling home prices.
ABS figures for the March 2011 quarter show loan volumes dropped by 3% in Adelaide while house prices fell by 1%.
That’s the technical stuff but what does it mean for you?
If you own an investment property [or two] should you hold tight for the next few years or should you try and sell and lock in some profits?
On the contrary this could be the best time to buy up! With sales volumes trending downward since September 2009 and the amount of stock on market rising, many vendors have resorted to discounting their asking prices. As a result buyers now hold the power and can pick up a property at a reduced price.
Buy more or sell? Who should you listen to? What’s right for you will depend on your circumstances and your investment plan and goals – as always making the wrong decision could be costly – so always make sure you speak to your trusted finance broker [that’s us] before you take action.
Not even the so-called experts agree on what the market will do…
According to research house BIS Shrapnel “Property price growth will be subdued for the next 10 years, growing no more than 5 per cent each year with the weaker years seeing just 2 to 3 per cent growth. Australia is unlikely to see the rapid growth of previous years again anytime soon.”
“If you can afford to buy then you should” that’s the word from McGrath Estate Agents chief executive John McGrath, adding “whether you’re an investor, first home buyer, or an upgrader you’re going to make a lot of money over the next five years out of residential property.”
Interestingly ABC’s 7:30 Report ran a story last week called ‘Australian house prices – are we heading towards a property crash?’ highlighting two completely different ‘expert’ opinions on the state of the property market. If you have a moment it’s worth a look – simply click here
So the days of 10-20% price growth are behind us for the moment but does that mean you can’t make money in real estate anymore?
If your plan is buy and hold you could struggle to maximise your investment. You see the best way to make profits in a flat market is to ‘create’ equity rather than wait for it. That’s why we’ve been holding regular renovation seminars this year. For more info and to find out how one of our students [a single working mum with no renovation experience!] made over $50k in just 4 months following the strategies we teach click here
As you take a moment to read this month’s news, remember Urbantech is always as close as your phone
To read our full newsletter click here
Your Partner in Success,
Finance Adelaide, Home Loans Adelaide