Every business feels the effect of a looming Federal Election as Australian’s take check of how potential changes could impact their future financial position. But a week on and buyer sentiment in the residential property market is more than positive.
“We expect to see a slight cautiousness from potential buyers as they prepare to select a new leader but post-election and interest in the apartment market is stronger than expected – anecdotally, better than we have seen since the beginning of 2019, ” said Art Group Project Director, Brett Smith.
In addition to the election outcome, improved external economic factors are now in play. Most notable is the confidence that is evident in the Australian Prudential Regulation Authority (APRA) removing the 7 per cent serviceability buffer on home loans in the past week which is very good news for potential buyers.
“APRA’s serviceability buffer was introduced in December 2014 as a way of tempering the housing market. Requiring banks to assess all loans against a base of 7 per cent meant that some consumers who were motivated and ready to buy were ruled out of being able to service a loan. This change will have an impact on lending.”
Data released by CoreLogic this week also shows Canberra as the strongest housing market of all the capital cities when it comes to supply.
Optimum supply in a property market is an important consideration when potential buyers are choosing to invest in a property for both live-in and investment purposes – too much softens a market and too little creates frustration and drives prices up. CoreLogic reported Canberra supply as being ‘a comparatively low figure’ when compared the rest of the country.
“This is an ideal position for Canberra,” said Mr Smith.
As we prepare to deliver one of the first developments, On Forbes, as part of the rejuvenation of the Northbourne Avenue corridor, it is evident from enquiry that there is a high proportion of purchasers that value the opportunity to walk through a finished product and determine the quality of what they are purchasing before making a commitment.
“Our buyers are savvier than ever been before and place a great deal of time in making sure that they are getting what they pay for. We like this because it allows us the opportunity to put our money where our brand is and deliver a piece of art in every apartment.”
The inner north location of On Forbes in Turner and the Northbourne Avenue corridor continues to be a stand-out when looking at past and projected performance and retention of value.
CoreLogic, in conjunction with Aussie Home Loans, recently released a report titled 25 years of housing trends, which looks at historical market conditions and projected trends of all major capital cities.
“The report shows that in the past 25 years, the most significant unit growth in Canberra can be attributed to the inner north, with 50% of the top-performing Canberra suburbs increasing more than 500% in the 25 years since 1993.
The median price for 2-bedroom apartments in Turner is currently $534,500 and according to projections published in the Core Logic and Aussie Report, the median unit price in Canberra will increase to $1,383,240 by 2043.