Many of the foremost financial and property experts do not agree with the gloomy outlook that others see in the Australian real estate market. In fact, these specialists agree that the property market in Australia is still quite resilient.
The primary concern for many analysts is the misinformation that investors may be receiving that commodity and property values are diminishing confidence in consumers. Financial experts and real estate professionals want to make it clear to the public that property prices were not actually plummeting, and unemployment rates on the rise would not actually have an effect on values that is negative.
Rising Unemployment, Rising Opportunity
It is factual that median sale prices have fallen over the last few months, however, resale prices, which better indicate market strength, have in fact been on the rise, especially in the areas of Tweed Heads and Gold Coast. In all truth, the decrease in the average price of Australian real estate that has been reported actually proves the fact that the market’s lower end is becoming more dynamic and homes in these regions are priced over $700,000.
Rising unemployment rates are typically referred to as a huge influence on declining property values and sales; however, history indicated that increasing unemployment rates do not always mean a negative impact on the real estate market. On the contrary, previously when times were tough such as ’92, ’97 and ’01, the rate of unemployment rose just over 2%, while property prices increased by almost 20% throughout the same time period.
Get Ready For The Boom
Several investors of today reflect back to the 2003 boom, which they remember as the ideal buying time. In fact, the fundamentals of the real estate market are just as solid, if not more, now as it was six years ago. The baby-boomer generation is getting ready to retire, and the latest research indicated that the majority of retirees would be looking to settle in more and more locations along the beach from now and for at least the next twelve years.
Sean Rasmussen
Property Options Australia
Property Options Blog © 2006 – 2008
Hi Sean,
It’s good to know that the Australian real estate market is looking solid. Especially since I’ve just recently found your blog and can use this situation to my advantage.
I find it really interesting how what you hear in the media is not exactly the way it is in reality.
This article is good news for the real estate market. With all the bad press about the GFC many people are wary of investing at all, and the banks have become a lot more cautious and tightened up on their lending criteria.