Upgraders are the favourites to get the most benefit out of the property market in 2019, predicts Australia’s largest national body representing professional buyer’s agents.
Real Estate Buyers Agents Association (REBAA) president Rich Harvey said 2019 was definitely the year of the home buyer as tighter lending conditions would deter investors and softer market conditions favoured home buyers.
“Finance will be the big game changer this year,” said Mr Harvey.
“Gaining finance is taking significantly more time and the best weapon any buyer has to getting property secured quickly is making sure their finance is approved and cash buyers will be in the driver’s seat.
“Buyers should not be deterred by headlines about restricted credit, instead it should be a motivator to ensure their finances are in order so the application sails smoothly through credit checks.”
A survey of REBAA members has revealed upgraders who have paid a large chunk off their mortgages in Sydney and Melbourne were likely to see the benefit of moving into larger homes than last year for the same money.
Likewise, stamp duty relief for first home buyers and superannuation incentives for downsizers were also likely to stimulate interest nationally. Cashed up downsizers looking to move into apartments or regional areas for a tree or sea change were also in the box seat to pick the best opportunities likely to arise in the first six months of 2019.
“In Sydney, upgraders also have the luxury of more time on their side and a flatter rental market which advantages them if they have already sold and are subsequently cashed up,” says Jacque Parker from House Search Australia,
On the flipside, Cate Bakos from Cate Bakos Property said while the current lending conditions favoured downsizers, she expected some in this group to be fearful of selling in the Sydney and Melbourne markets as the higher priced properties were often struck with more discounting than the lower-priced options.
“The increased lender scrutiny is adversely impacting higher price-band properties, while the combination of more favourable lending conditions applying to the lower price-band stock and the government concessions for eligible buyers means that downsizing could be problematic for some,” warns Ms Bakos.
“A reduced sale price and a strong purchase price are likely issues that these buyers face in some markets across Melbourne.”
In Brisbane, first home buyers will also see opportunity in a stagnant market to jump onto the property ladder, according to Zoran Solano from Hot Property Buyers Agency.
“This is likely to trigger a chain of events where upgraders and downsizers will trade houses as well,” he said.
“We are also seeing strong activity from downsizers in our Gold and Sunshine Coast markets as the sea change phenomenon hits its stride again this property cycle.
“Upgraders are already looking to buy and renovate or build in the middle suburban ring of Brisbane as these suburbs begin to gentrify and families struggle to find large modern homes in more established character areas.”