2019! – What is held for the Australian Properties?
As 2018 has come to an end, property prices continue to decrease in Melbourne and Sydney, while the rest of Australia are more stable.
In 2019, we will see the final report from the Financial Services Royal Commission, as well as a Federal election, which may well mean a change of government.
What does this mean to the Australian property in 2019?
Final report released from the Financial Services Royal Commission
The Royal Commission is now over, and the closing report is due early this year. Although there was attention on lending for home loans, at this stage, it’s looking progressively likely that access to finance won’t get any more restrictive.
Banks began self-regulating their home-loan lending as soon as the Royal Commission was publicised in December 2017 and, as a result, it’s already far more difficult for people to borrow to buy property.
At this stage, it’s looking gradually likely we will have a Labor Federal Government by mid year. While larger political stability is good news for property markets, the possible changes to negative gearing and capital gains tax concessions flagged as a key policy are not so much.
If the changes are made, it’s likely we’ll see an additional hit on house prices and difficulties will arise with rental supply.
Regardless of what happens, the potential for changes has already startled investors with lending to this group down 30% from the peak.
Price drops in Sydney and Melbourne to last until at least mid year
Circumstances are very tough in Sydney and, while Melbourne is slightly better, at this stage it looks like we are in for a slow start to the year for both cities.
The challenge is the indecision in the market and until the Royal Commission is finalised and the Federal election is over, these soft circumstances will continue.
Hobart and Adelaide to be the top performers
In the first half of 2019, the market will be slow, yet, there are two cities that continue to lead many of our most in demand lists.
In 2019, Hobart is likely to slow but will still be in positive growth territory. Adelaide never saw the heady highs of Melbourne and Sydney over the past 5 years and right now, that is working in its favour.