Property market about to go ballistic in australia

The Property Market Is About To Go Ballistic!

I’ve got good news for you and more good news!

Firstly, you may have heard that the Reserve Bank of Australia (RBA) have indicated that interest rates are likely to stay low for the next 3 years, which is unprecedented. And even though we are living in unusual times, the property market is going to remain strong for time to come, especially with interest rates as low as 1.89% at the moment.

Property Prices are going ballistic

Secondly, the latest Corelogic data shows that the property market has grown by a national average of 6.6% even with state lockdowns and border closures. With the exception of Victoria, the rest of the country is going from strength to strength when you factor in what we as a nation have been through in the last year.

Having said that, I believe Victoria will experience a delayed bounce. Last week, Victoria had an 89% clearance rate based on 747 auctions registered for the week. Only 75 properties were passed in, yet there were 1370 private sales, demonstrating that Victorians are still preferring private sales over auctions at the moment. My guess is that auctions will continue to rise in the future.

Here are the results indexed as of 31 January 2021.

And when you look at the in-rural house prices over the past twelve months, you’ll see that values have increased by as much as 40%.

rural house price increased by 40% - 2

Last year I predicted an economic V curve bounce and it’s clear that the bounce is happening and for those who are getting into the market will enjoy strong capital growth, especially over the next couple of years.

The key is to make sure that you select properties that will be in demand by tenants. This will ensure that you minimise your risk and not suffer long vacancies.

Property market is going from strength to strength.

The above figures show that people are continuing to see property as a strong vehicle to future proofing their retirements however with the increase in values of rural properties, people are also looking at lifestyle as an important factor when buying. It’s becoming clear that people are wanting more room and space should lockdowns continue to happen and if we are no longer required to work in an office, this makes ‘the home’ an even bigger lifestyle decision.

Here’s my tip:

As investors you need to be mindful of your property selection. Extra living spaces, two or more bathrooms, a study or extra bedrooms, a backyard or a park close by are all important considerations. We are living in unprecedented times and the reaction to the property market is demonstrating that. If you’re thinking of getting into the property market, now would be a great time to do so. Enjoy the ride. 😊

Until next time, stay safe

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