Well, it took the residential market a long time to cheer up and start to move again. However, the Christmas season arrived and with it the cheer that had been missing for over a year.
Record low interest rates, the onset of summer, the need to make a decision by Christmas and positive media re the state of the market may have together sparked something of a revival. Buyers are back out in force. We can report a different mood and competitive bidding at most auctions. The basic question is “will it last?” Next year is election year, that can often cause things to go into wait and see mode. Our sense however is that there is a general catch up in play.
Since 2015, until recent months, sales numbers have been falling.
The foreign buyer ban was definitely part of this, as was a shift in the attitude from banks generally to what and how they might fund purchasers. Given the strength of immigration over the period and falling interest rates, we feel the lower sales volumes were driven by
negative sentiment, as mentioned this is changing. We note several commentators/bank economists predicting an increase in house prices over the next year or three. We agree.
First home buyers are back in force, swapping rent for home ownership thanks to today’s record low interest rate mortgages. This is quickly firming the market around $1,000,000. This is translating into a trickle up effect, the outcome of this will become clearer by the month.
As a buyer, if you were waiting for the bottom of the market you may have missed it. Similarly for home owners waiting for a good time to go to the market – this is it!
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