Almost two thirds of Australian’s think now is a good time to be buying a home while roughly the same proportion believe the housing market is vulnerable to a significant correction.
The latest quarterly housing market sentiment survey by CoreLogic and TEG Rewards housing market sentiment survey highlights the paradox in housing market attitudes.
The data shows that 64% of respondents thought it was a good time to buy a property, up from 60% of respondents a year ago. However, 65% also indicated they thought property values could suffer a significant correction.
Sydney based respondents, where affordability constraints are the most pressing of any capital city, were the most pessimistic about whether now is a good time to buy a property, however slightly more than half the respondents still felt it was a good time to buy.
Conversely, the regions where dwelling values have peaked and shown a downturn are where respondents are most confident about buying conditions. Some 80% or more of respondents in the Northern Territory, Regional Western Australia and Perth indicated they thought it was a good time to buy.
‘With such as a large proportion of survey respondents thinking that now is a good time to buy a dwelling, it was surprising that almost two thirds also indicated they thought dwelling values could suffer a significant correction,’ said Tim Lawless CoreLogic head or research.
‘While the results suggest that survey respondents are concerned there could be a substantial fall in Australian home values, the proportion is lower from a year ago when 75% of respondents thought the market was vulnerable to a significant correction in values,’ he added.
When asked whether dwelling values would rise, fall or remain steady over the next 12 months, the majority of respondents expected values to remain steady, with Tasmanians the most optimistic about the direction of value growth over the next year.
Nationally, 38% of respondents are expecting dwelling values to rise over the next twelve months. In contrast, a year ago 45% of respondents thought values would rise, indicating that respondents have become less optimistic with regards to their views on capital gains over the next financial year.
For rental market conditions, only 11% of survey respondents are expecting weekly rents to fall over the next 12 months, despite the CoreLogic rental series showing the weakest rental conditions in at least two decades.
Nationally, almost equal numbers of survey respondents indicated that weekly rents would either rise or remain stable over the coming year, however there were some considerable variations across the regions.
Less than one fifth of respondents in Perth and Regional Western Australia think weekly rents will rise. ‘The low expectation of rental rises in these areas is in line with current rental statistics which show ongoing falls in weekly rents across most parts of Western Australia,’ Lawless pointed out.
