City Apartments Blog
Property Market update for 2011
Darren Rodgers
08 Apr 11
All indicators show 2010 was a flat year for property
With interest rate rises and the end of the first home-buyer boost, demand for property was low as evidenced by subdued price growth and the low number of properties transacted.
All markets in Australia found 2010 challenged. A succession of events that started with the proposal for a resources tax was followed by political instability with a Prime Minister Challenge and the eventual execution of KRudd, then came the lengthy election campaign which resulted in a hung parliament and the fiasco of 3 independents controlling the economy for more painstaking time periods, all prior to further interest rate rises.
Since this time we have seen a challenging start to the year with the devastating Brisbane and Queensland floods followed by mother nature’s strength of destruction in North Queensland, Australian’s focus on property and the financial sector took a back seat with doubt and fear drove a halt to the investment sector while we waited to see what impact these events would have on our economy.
Queenslanders have also been faced with increase costs of living more so with fuel and water. The retail sector has highlighted the softening of consumer confidence as household budgets have been forced to be re-evaluated and adjustments made to weekly spending habits.
The media have been very pro active in letting all Australians know of the current state of our economy and how the government have kept this Country in a stronger position than that of our neighbours.
Whilst no one is brave enough to predict the 2011 growth forecasts. One common trend being vocalised is that the property market is still “A Buyers Market”. That being said Blue Chip investment areas will still hold their own in a down market whilst property in suspect growth regions may still have more price adjustments to complete a sale.
The general consensus is that properties within 20klm of a CBD or suburbs with Major Infrastructures and Public Transport will still support strong tenancy demand.
If 2011 is to see a growth in property then two major factors would need to be initiated
· The RBA to keep interest rates on hold or even be lowered
· The lending institutions to soften their stringent loan criteria
Property simply operates in a supply vs demand system. As sellers become mindful of their current position in the market place, buyers will be waiting on the side lines ready to pounce. The market is likely to deliver a closer expectation of sale price between the vendor and buyers. This will likely show a steady increase in turnover of properties more so then high percentage increases on value.
Keep a close eye on the two dot points above, the states auction clearance rates, property transaction rates and open house attending rates. Monthly fluctuations of these trends will indicate where the property arena is moving.
Darren Rodgers
Director of Sales
