Walkom Real Estate
Property Market Update : February/ March 2019
What’s helping drive the Newcastle property market?
The inner city Light Rail transport system is now operating, making it easy to go from Newcastle West to Newcastle East. It seems very popular and opens the whole CBD up to many more people. Hop on it!
The University of Newcastle announced (21/2/19) a new $25M inner city ‘Innovation Hub” building at Honeysuckle (see image). After this one, it’s planning a 300 bed student accommodation building. It’s apart of the Honeysuckle City Campus Development (HCCD), located on a two hectare lot, right in the heart of the CBD. This project coupled with the existing New Space building (3000 students) and the completion of around 700+ residential apartments within the next three years in the CBD will create a fantastic, popular and very vibrant inner city, where property is in demand. Property investors take note! Learn more
Main factors effecting the overall property market
- Interest rates remain low – very positive. It’s just a lot harder to get a loan.
- Investor demand remains low – they are taking a wait and see approach
- Owner occupier demand – cautious – still strong for prime property
- Less foreign buyers – China tightened up funds leaving their country – lowers demand
- Quantity of new builds reducing – less building approvals – less supply in medium term – helps create a stable market
- Auction clearance rates improving – above 50%
- Rental market firm
Overall
- Property market cycle moving towards balance
- Supply heading towards equaling demand – where prices recover
- 2019 maybe seen the best year to buy a property.
What the Reserve Bank says;
After rising by almost 50 per cent over the five years to September 2017, national housing prices had fallen by around 8 per cent to be back around mid-2016 levels. The significantly different developments in housing prices across the country. Housing prices had fallen by 12 per cent in Sydney and by 9 per cent in Melbourne from their peaks in 2017. There had also been significant falls in housing prices in Perth and Darwin over recent years. By contrast, housing prices in Hobart and Canberra had increased over 2018, while housing prices in Adelaide, Brisbane and many regional centres had been flat. The cumulative falls in housing prices in Sydney and Melbourne were relatively large by historical standards, and that it was unusual for housing prices to fall significantly in an environment of low mortgage interest rates and a declining unemployment rate. (RBA Minutes of the Monetary Policy Meeting – 5/2/19)
By Scott Walkom
Email scott.walkom@walkom.com.au