We haven’t seen a nationwide property market boom since the early 2000s. Though Sydney and Melbourne saw price rises from 2013 to 2017, this was not observed in many other cities throughout the country.
Now, however, there are several forces at play which are likely to generate major growth in most Australian towns and cities. So, is the Australian property market set to soar in 2021? According to the big banks, renowned economists, and property experts, it may well be.
Real estate research analyst Simon Pressley said, “Make no mistake, property markets in large parts of Australia will be booming by summer! Several locations in different parts of the country have already produced double-digit capital growth over the first 9-months of this calendar year and there are umpteen others with fast-growing momentum.”.
The Fundamentals Backing Australian Property Markets
Throughout COVID-19, most Australian jurisdictions have seen a rise in property prices. This is despite the media having forecast a decline in the housing market of up to 30%. Whilst the economy may have slipped into recession because of the global pandemic, the property market has not.
Below are some of the factors giving life to the increase in property prices we’ve seen over the last few months and are likely to continue to see in 2021:
The Australian population continues to grow at a rapid rate. The ABS stated that for the year ending 30th June 2019, Australia’s population grew by 239,600 people due to net overseas migration alone. Though population growth has slowed down in the short-term because of COVID-19 and its border restrictions, it may not be long before it revs up again.
With Australia perceived as a ‘safe-haven’, especially in light of recent events, we can expect immigrating to Australia to be a popular option once our shores reopen. Therefore, there will likely be a significant increase in demand for housing.
The supply of housing throughout Australia is diminishing. This combined with the lack of new major developments in the pipeline suggests we are likely to experience a housing shortage over the next few years, driving up property prices.
Declining Interest Rates
Whether you’re an owner-occupier or an investor, the low-interest-rate environment which continues to prevail in Australia means it has never been cheaper to own property. With interest rates expected to continue to fall, so are the out-of-pocket costs associated with owning property.
Thanks to cheap finance, increasing property prices and Government incentives, first home buyers are back in the game. First-home buyers are noticing that property prices are increasing quicker than they can save. As a result, the rush is on to not miss the property boat.
What the Media is Saying
COVID-19 started to affect Australia in February 2020. Since then, two-thirds of the monthly price results have been positive. Yet the reporting carried out by mainstream media painted a different picture.
In recent times, however, we have seen a shift in sentiment. Here are some recent headlines:
Considering the reluctancy of the media to report on positive property market trends, we find this rather noteworthy, albeit a few months late.
How Bolt & Hunter Can Help
Significant portions of Australia seeing notable property price increase already. This suggests the upward trend has already commenced. Local economies are showing signs of strength, the number of vacancies is dwindling and those looking to enter the property market for the first time are becoming increasingly active.
Are you looking to purchase your first home or capitalise on the market conditions and develop your property portfolio? Bolt & Hunter has a seamless a to z solution for you.
Leave the hard work to us and lean on our industry knowledge and expertise. We’re here to help you secure the right property, at the right price and the right time. Contact us today!