With the end of 2018 fast approaching, let’s take a rear vision look over the past quarter – and a forward look at what may lie in store in 2019.
The festive season certainty brings plenty of good cheer to home owners. Interest rates remain at record lows, the economy is in good shape, and the Reserve Bank is predicting that today’s strong job market will help to support wages growth, which may put extra cash in our hip pockets in 2019.
Australia tops global wealth tables
On the property market front it’s been a remarkable year. Despite recent price falls in Sydney and Melbourne, home values remain 46% and 40% higher respectively than they were five years ago, and that’s given household wealth a tremendous boost. Elsewhere in the nation, property values are stable in Brisbane, and some state capitals have notched up price gains over the recent quarter including Canberra (up 1.5%) and Hobart (1.2%) and Adelaide (0.2%).
In fact, a recent global wealth report by Credit Suisse found Australia has the highest median wealth per adult of all nations, and it’s largely the result of strong property values.
While home values across our state capitals have dipped 4.7% this year, it’s worth highlighting that the bulk of price falls have occurred at the top end of the market. Melbourne’s more affordable suburbs for example, have actually risen in value by 4.1% over the last year. That’s being driven by a welcome return of first home buyers, who now account for almost one in five new home loans.
Regional markets forge ahead
Good news for regional Australians, who are also benefiting from gains in home equity. Regional Tasmania is the standout, where home values have soared 11.54% over the past 12 months. Values in regional Victoria have jumped 7.4% over the last year, and in New South Wales, the Hunter Valley has been the big achiever with home values rising 5.1%.
Expert home loan help has never been more valuable
In the mortgage market both home buyers and home owners are reaping the rewards of intense competition between lenders. Banks are keen for new business, and we are seeing plenty of value-packed home loan deals up for grabs.
Lenders are increasingly offering their lowest rates for new customers. That’s a big incentive to talk to your Aussie Broker to know if you could get a better deal – especially if you’ve had your home loan for a while.
Banks are tightening their lending criteria, in particular, taking a closer look at how well you can manage home loan repayments. This makes it especially important to speak with your Aussie Broker to understand the steps you can take to get the green light on the home loan that’s right for you. Something as simple as reducing credit card limits can make a valuable difference.
What’s in store in 2019?
Looking ahead, there are plenty of signs that the New Year will be a prosperous one. Sure, the property market may slow down a little further in early 2019 but as CoreLogic points out we’re just not seeing the factors that could drive more substantial falls in home values. Some research groups are saying we could see a return to rising property values from mid-2019.
On the interest rate front, the Reserve Bank has once again flagged that the next rate move is likely to be up. However, it’s also made it clear that there’s no immediate hurry to lift the cash rate.
The bottom line is that the next few months could offer plenty of scope for you to advance your property goals. From getting a better deal on your home loan, to buying a next home or investment property, talk to your Aussie Broker to know how you can make it happen.
You may also be interested in: How a broker helps when lending criteria is tightened,
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