The election is over….so what’s it mean for property?

Bloody good things, is what!

You could argue that there’s been some inertia in the market in the lead up to this week’s election. Doom and gloom with respect to changes in negative gearing and capital gains taxes, prompting a lot of “looking but no touching” from our buyers, and navel gazing from our sellers. As of Saturday evening however, it seems phone batteries are suddenly charged and the conversations are beginning to feel a lot more positive.

One of these motivating factors is the projection that the RBA is to make 2 interest rate cuts, which could a the shot on the arm that buyers are waiting for…and for sellers, the optimism that the Liberal government policy is representing (or if you prefer, the prospective negativity that has been removed!) means an opportune time to take action.

Drawing on some insights from our learned industry colleague Aaron Shiner, a summary of what this means for you as WA buyers and sellers is as follows:

  • Leading up to the election big business and cashed up buyers had been sitting on the sidelines. Some doomsayers had been spruiking as much as a 40% drop in property values and “astute” buyers hoped that was true!
  • We are seeing new buyers showing interest in properties with our enquiry levels showing a marked up-tick…Given we have still have very low stock levels (especially in the 6007 postcode), we expect increased competition in the short term from buyers which should lead to shorter transaction times.
  • Interest rates remain at very low levels with the short-term forecast trending lower in the very short term. With APRA relaxing some lending criteria it means that clients could now afford to borrow an extra $60,000 on a million-dollar property. The ability to fix mortgage rates at such affordable levels is a huge incentive to purchase property now.
  • First time home buyers who had deserted the established property market are expected to return in the short term because the Liberal government has introduced the First Home Loan Deposit Scheme which will allow eligible buyers purchase a home with a deposit as low as 5%. These buyers may also save around $10,000 in Lenders Mortgage Insurance under the scheme. *This scheme is currently capped to the first 10 000 borrowers so it has a limited duration.

I’d love to hear from you if you would like to discuss your own circumstances and put a plan in place to make the most of these positive conditions! E

 

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