2019 is fast approaching and it’s going to bring new opportunities for anyone looking to make a residential property purchase in the new year.
As January creeps closer, it’s the point in the year when many start looking at their current home and ask whether it’s time to make a move. Investors too will be taking a break over the holidays, looking at their portfolio and considering how it could change in the new year and where the opportunities are to secure a strong return on their investment.
Of course, there’s going to be a few key developments that shape home buying in Australia in the new year, that will all affect residential sales in Canberra. So what will 2019 hold for home buyers? Here are a few of the most important trends that will shape residential property sales:
Land supply will continue to shape price
According to research from CoreLogic and the Housing Industry Association, rising land prices are the single biggest factor in wider rising house prices. To respond, the ACT’s land release program is continuing to expand the supply of greenfield property, creating over 14,000 new properties across Canberra’s northern, western and central suburbs.
For existing suburbs, the new supply of properties may affect prices in 2019, as new builds increase the supply of properties. However, suburbs that are also seeing these new developments could benefit, with the territory government including new community facilities in greenfield developments, which could increase the appeal of the area’s existing housing stock.
Detached homes may see more activity than apartments
One of the biggest shifts in Canberra has been the rise apartment construction, with many new units coming to the market in the last few years.
Interestingly though, the market for apartments is likely to stay subdued in 2019, with most of the growth in property values coming from detached homes. That’s according to QBE’s house price forecasts, which expect detached homes in Canberra to grow in price by 5.8 per cent, while units are forecast to grow by 1.2 per cent.
Of course, for those looking to enter the market, yearly price changes are just one thing to keep in mind. There are a few different reasons why unit prices might be subdued – there’s been a lot of new developments coming to the market, so there’s lots of supply. For investors, annual changes in value will also have to be weighed against the property’s rental yield and appeal to possible tenants, for example.
Fundamentals should help keep the market steady
There’s been a lot of coverage of falling house prices and rising interest rates across Australia and many experts are expecting to see more of the same in 2019. However, it’s a different story in Canberra, at least according to the CoreLogic report.
The research into home prices across all of Australia’s main centres found that Canberra house prices will hold steady and likely grow in the next 12 months. This is being held up by the strong demand for rentals and the fact that Canberra’s home prices have kept pace with income rises over the last decade, keeping it more affordable for buyers. Canberra’s population is also still growing strong, which is helping to even out demand for property.
So, it already looks like 2019 will see a lot of change in the Canberra property market. All these moves are going to offer different benefits to residential property buyers so, as we head into the new year, it’s going to be important to keep an eye on these developments.
If it’s your new year’s resolution to make a new move in residential property, make sure to talk to your local Civium team about the opportunities you face in the market.