Sydney Property Market
Sydney property sellers are now facing the toughest market conditions since the dark days of the Global Financial Crisis of 2007-08.
Property clearance rates have slumped as low as 44% and the transactional activity has fallen by about two thirds in dollar terms over the past financial year.
This alarming downturn is due to several factors.
The impact of the Banking Royal Commission upon lending practices has seen a tightening of eligibility criteria, making it much more difficult to secure finance, particularly interest only type loans. This has seen investment loans in particular become much more difficult to obtain.
Additionally, many potential first home buyers have found the cost of entering the property market prohibitive.
Most property analysts agree that the downturn has some way to go with some like AMP’s economist, Shane Oliver predicting that Sydney and Melbourne house price could fall twenty percent over the coming year.
This fall could have devastating consequences for home owners who have highly geared properties. Falling property prices could force many home owners with little equity in their homes to place their properties on the market, simultaneously increasing housing supply and placing further downward pressure on housing prices.
While this scenario will cause great discomfort for many, it may encourage potential first home owners to enter the market.
In these uncertain times it’s more important than ever to understand exactly what you are entering into when obtaining finance for a property purchase. Australian Finance Hub s uniquely placed to assist you in negotiating your nest property transacton.