The ANZ-Property Council
survey results have been released and despite the negative sentiment and the tightening of lending conditions in recent months, the survey results reveal an optimistic outlook for the property sector.
Confidence in the property market generally is expected to improve across most states compared to where we were in September of 2016, with significant growth expectations in New South Wales and Western Australia. It appears that the improvement in commodity prices has had a positive effect on Western Australia, reporting their strongest growth in 3 years.
The retail sector weakened slightly due to a decline in spending however commercial property seems to be holding well with continued industrial infrastructure construction. The Property Council of Australia’s expectations is that Australia will experience an increase in construction in the residential, office, industrial, and retirement markets.
One of the drivers for growth is the cost and availability of finance and with that, lending requirements continue to be tightened and interest rates continue to rise. The Property Council of Australia’s expectation over the next 12 months is that interest rates will continue to rise.
Despite expected growth and interest rate hikes, the survey shows an increase in confidence generally across the property market sector. Results show 49% of respondents stated they expected house prices to continue to rise over the next 12 months, up from 42% and 35% from the previous two surveys conducted.
This news might not be warmly welcomed by those who are trying to enter the property market. Housing affordability is high on the agenda for the Federal Government as the next budget announcement looms. There will be further updates on the next budget announcement from our Team at HLB Mann Judd.
Contributing author Fady Nahabia, Business Advisory Manager at HLB Mann Judd