Fifty per cent of Australians believe house prices will increase over the coming months and 41% believe they will rise in the next six months specifically – but there are massive disparities between states, according to the RP Data Nine Rewards consumer sentiment survey.
RP Data researcher, Tim Lawless, says the survey questioned 1,030 consumers on their expectations for the Australian housing market over the next six to twelve months and found a ‘substantial upward shift’ in overall consumer expectations for housing market conditions.
But this was largely led by high expectations in concentrated regional markets.
“Based on the survey results, we’ve seen distinctive differences from region-to-region where, as an example, 59% of respondents in Perth expected values to rise over the next six months, and 56% of respondents located in Sydney expect values to rise over the next half year.”
“In contrast,” says Lawless, “survey participants in Tasmania delivered a much more sedate reaction with no local respondents expecting values to rise over the next six months.”
Hobart-based broker, Richard Denholm, says he’s not surprised by the lack of optimism in Tasmania – but says there are some signs of improvement.
“It actually seems like there is a bit of movement…I think, initially, you might have people that are under a bit of housing stress, as they’ve maintained their houses at the top of the market. But the new stock that’s coming on is priced more realistically and it’s moving. As a result, there’s a bit more demand. That will probably take six months to flow through though.”
Denholm says a heavy reliance on government sector jobs is a leading force behind the state’s slumped housing market.
“The problem down here is that Tasmania is dependent on state government employment. Yesterday, the Liberals announced that they were going to cut 500 government jobs if they come into power. With that negative message getting out there, people are hesitant to get into any long-term investments.”
Lawless says 80% of respondents feel now is a good time to be buying a property and 37% believe it’s a good time to sell.
“As consumer confidence in housing market conditions rises, we are likely to see a larger number of dwelling sales as the year progresses. We have already seen buyer numbers rise from their early 2012 lows, and transactions over the past six months are about 4.3% higher than the same time a year ago,” says Lawless.