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Every new-year, economists, industry organisations and commentators try and predict what the housing market trends will be for the year ahead.  In 2016, following a period of sustained growth many are predicting that in the evolving economic environment, Australia’s housing market is on track for a period of significantly reduced growth or even decline.  

What’s driving the change?

The catalyst for change has been driven in part by falling global demand and lower commodity prices for Australia’s resource exports resulting in the end of the resources boom in Western Australia, Queensland and the Northern Territory.  

Other factors include affordability pressures, rental yield compression and changes to the regulatory framework introduced by APRA which has made it more expensive and difficult for investors to access housing finance and the more recent bantering by government on amendments to the negative gearing legislation for investors, which would affect the rental markets quite dramatically. 

The predicted longer term higher mortgage rates and more restrictive credit policies and loan servicing requirements have also put pressure on the owner occupier section of the market. 

The Sydney and Melbourne markets are forecast to be impacted by the new Foreign Investment Review Board regulations, which came into force on 1 December 2015, which will most likely flow on to WA, affecting overseas buyers and possibly the rental investment market. 

The news is not all bad…

In Australia as a whole, net overseas migration has eased since the peak in early 2013, mainly due to fewer skilled migrants coming to Australia.  The impact of this has taken some of the heat out of the Perth property market making property more affordable - good news for those entering the market for the first time, albeit developed land prices in WA remain excessively high compared to other regions, and/or purchasing an established suburb demolition property to re-build, which is sometimes a little more expensive, but more affordable long term when considering location, transport and investment growth.  

There is always opportunity for the smart purchaser

While luxury homes in Australia’s major capital cities are taking a little longer to sell, in Perth this section of the market remains fairly resilient. Smart buyers are taking advantage of the slowing market conditions and acquiring older established properties on large blocks. Buying in a good suburb with the intention of demolishing is popular, constructing either a custom built luxury home or developing the site into stylish town houses or villas albeit there may be an oversupply in this area in the short term.

There will never be a more affordable time to build than today!

 

There’s always lifestyle and convenience

The Perth climate ensures lifestyle will always be a driving factor in the property market.  Beach side properties are still in high demand and smaller inner city blocks retain their popularity with professionals who wish to avoid a long commute and love the buzz of living in the city. 

These narrow or irregular shaped blocks, which may become more prevalent in WA with the government implementing rezoning in many areas, to increase density, are perfectly suited for two storey homes which take up less space and offer buyers looking to capitalise on market conditions a multitude of options, however good custom design is essential for the longer term investment and lifestyle – why build a standard design not entirely suited to your site?. 

At Artique, a Custom Designed Home will provide a superior layout for your individual site and is no more expensive than a standard project home, whereby we include everything required from day 1, including Design, demolition, ‘fully quoted’ siteworks, and a comprehensive, all-inclusive specification, so there are no hidden extras later that you may not have budgeted for – Artique Homes – Inspirational Custom Design, Built on Trust – Experience the Difference.