Are We Entering a Buyer’s Market in 2016?

As the Reserve Bank get ready for their first meeting of 2016 next week, there’s a lot of discussion around how the property markets will perform this year. Our mortgage broker, Wayne Pope, looks at what some experts have said about the prospect of a buyer’s market.

It’s the question many people are asking as we progress into 2016; is a buyer’s market emerging across Australia? Many experts have explored the subject – here’s what they are saying.

Corelogic RP Data

In its statement released last month, Corelogic RP Data observed that early signs for 2016 indicate value growth in Sydney and Melbourne will slow, however, it is not yet clear if this slowdown will actually result in value falls. In other parts of the country – according to the report – the housing market conditions are looking as though they will start to pick-up – South-East Queensland, Canberra and Hobart have all been tipped here.

Corelogic also note that the changes in the lending environment is likely to continue to impact the market in 2016. Interest rates are set to remain low which could affect demand across housing markets.

Brian White, Ray White Chairman

Taking a different view compared to many industry observations, Mr White believes Sydney will continue to lead the way in 2016, although he does recognise that growth is likely to be at a slower rate than recent years.

Mr White said that while we might not see as many astounding price tags in Sydney, he believes values would gain momentum. He went on to say that if Australia’s economy performs as is widely anticipated, and with the recent rise in unemployment numbers, real estate price increases should (again) be a feature in 2016.

Tipping five per cent growth for Sydney, Mr White believes we’ll see growth in Melbourne of around four per cent, Brisbane, two per cent, Adelaide one per cent and for Perth to remain flat.

Domain

Senior economist of the Domain Group, Dr Andrew Wilson, believes confidence in the housing market is still strong, but said we have “a legitimate buyers’ market in Sydney”.

Dr Wilson explained that sellers – particularly in Sydney – are feeling more nervous, especially since headlines emerged about house values falling. This, coupled with a relatively soft start to the new year, Dr Wilson said there is a opportunity for homebuyers.

As move further into the year, we’ll no doubt see trends emerge across the country that will set the scene for the selling seasons – watch this space.