 Property market sentiment has rebounded sharply among investors but first home buyers are starting to feel the pinch of affordability pressures, the latest ME Quarterly Property Sentiment Report shows.
A national poll of 1000 investors, owner-occupiers and first home buyers at the start of October found that confidence improved dramatically over the past three months, fuelled by the consistently strong price growth across major markets and signs that banks were lending again. Forty-two per cent of Australians were feeling upbeat about the property market – up by 9 per cent compared to the previous quarter. While sentiment improved across every age group, property status and buying intention, investors and Millenials and those who plan to buy in the next 12 months were the most optimistic. n contrast, sentiment among first home buyers has been subdued as affordability constraints started to bite, ME’s general manager for home loans Andrew Bartolo noted. ‘‘One of the flow-on impacts of increased sentiment has been price increases. This impacts the first time (buyer) more acutely than investors whom they are competing with,’’ he said. Almost half (47 per cent) of those surveyed expect prices to rise over the next 12 months, up from 38 per cent in July. Sydney-based buyers’ agent Samara Metri, director of Buyers Club, said the business was signing twice as many clients per month as it was a year ago. ‘‘This time last year we were signing up around 10 clients a month, now we’re adding between 20 and 25 clients,’’ Ms Metri said. ‘‘We’ve not only had more people come on board but they’re transacting much faster. ‘‘We’ve even noticed a lot of competition when negotiating on property as real estate agents are becoming more confident.’’ Scott O’Neill, director of Rethink Investing, said investors have returned to the market in a big way. ‘‘We’re literally twice as busy now compared to this time last year. The negative sentiment has been lifted,’’ he said. Mortgage brokers have noticed a rise in the number of people applying for a loan since the federal election. ‘‘This could be attributed to pent-up demand from buyers who had put their purchasing plans on hold and now want to take advantage of the low interest rate environment,’’ said Mortgage Choice chief executive officer Susan Mitchell. Original article published in the AFR. Nov 2019.
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