![Australians positive about house price growth but worry about affordability, survey finds Australians positive about house price growth but worry about affordability, survey finds](https://paragonproperty.com.au/wp-content/uploads/2019/07/DSC_1828_h1xmab.jpg)
Australians are feeling more positive about property price growth but are still worried about affordability, a national survey of first-home buyers, owner-occupiers and investors shows.
The number of people expecting house prices to rise has risen across the country, ME Bank’s quarterly Property Sentiment Report for the June quarter, released on Tuesday, shows – with 38 per cent of Australians expecting house prices to rise over the next 12 months.This was up from 32 per cent in the March quarter. The survey showed that while overall sentiment was improving in Australia, some states were still holding negative outlooks when it came to property values.
ME group executive – customer banking Craig Ralston said the improved sentiment from buyers was unsurprising given the Reserve Bank’s recent interest rate cuts, changes to lending criteria for mortgages and the certainty over negative gearing options since the federal election. “We weren’t actually surprised to see an improvement this quarter given what’s happened,” Mr Ralston said.
Rising auction clearance results were also having an impact on attitudes, he said.“Positivity among sellers and owner-occupiers suggests these groups see the recent market trends as a sign their homes are retaining or regaining value again,” he said.
The survey involved 1000 people from across the country – 500 owner-occupiers, 300 investment property owners and 200 first-home buyers. In NSW, many still believed the value of their property would drop over the next 12 months compared to other states and territories, with 41 per cent of people surveyed believing prices would continue to fall across the state. Only 26 per cent believed prices would rise.
In Victoria, more than one-third, 36 per cent, believed their property prices would fall with one-third expecting prices would jump. In WA, 26 per cent believed prices would drop and 21 per cent thought they would rise.
Things were a little more positive in the other states, with 36 per cent of Queenslanders and half of Tasmanians believing house prices would rise in the next 12 months. Home owners in the ACT seemed much more positive with 32 per cent believing prices would rise and only 6 per cent predicting a further fall in prices.
While most were more positive about house price growth, housing affordability was a major area of concern. Almost all – 93 per cent – listed it as a leading issue despite the cooling prices in major cities including Melbourne and Sydney.
“House prices remain high by historical and international standards, hence perceived worries about affordability may take time to shift,” Mr Ralston said.
In what he described as one of the biggest surprises of the sentiment survey, Mr Ralston said investors’ positive sentiment had dropped since the March quarter survey. Investors had reported property prices had impacted their savings, sense of wealth and financial confidence.
“The drop in positive sentiment among investors is surprising considering negative gearing now seems to be off the table and APRA has proposed changes to home loan serviceability,” Mr Ralston said.
Source: Melissa Heagney, Domain