The Australian property market typically experiences a slowdown during the winter months, however, contrary to that, this winter we have seen exceptionally strong buyer demand. Experts believe this will continue through the rest of the season and into spring.
This high demand has been largely attributed to COVID, with people spending more and more time at home, they have more time to reevaluate their property needs.
This property boom has not shown any sign of slowing over the next few months either, statistics show that we are still seeing weekly preliminary sales at volumes similar to Spring of last year and demand remains at very high levels.
Although the pandemic has certainly increased the demand for housing, it is not the only reason for the recent property boom.
Record-low interest rates are the true cause behind the huge demand, and these incredibly low-interest rates are expected to last until ‘at least 2024’ according to the Australian Reserve Bank Governor, Phillip Lowe. Low interest rates are designed to encourage spending which has pulled Australia out of a recession caused by the coronavirus pandemic.
But low-interest rates also make it much easier for property buyers to take out loans to buy property, and because Melburnians are unable to spend money like they usually would, they have spare money to burn. When you couple this with low interest rates buyers have the perfect opportunity to take out a loan that will remain low-cost for a number of years.
While there has been an increase in the overall supply of houses, the overall stock remains at an all-time low, because the market is unsaturated, so it’s the perfect time to be selling a home.
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