Two-thirds of prospective home buyers feel that Australia’s housing market is vulnerable to a significant correction, a new survey reveals.
The housing market sentiment survey conducted by CoreLogic RP Data and Nine Rewards in September saw 1,021 respondents comment on what they expected for housing market conditions. It revealed that 68% of respondents believed there may be a correction, which is the highest reading the survey has received.
More than half of all respondents in each region felt that the housing market could see a significant correction. In Sydney and Melbourne – where values have recorded the greatest surge over the last two years – the proportion of respondents that felt the market was vulnerable to a significant correction was 68.6% and 67.3% respectively.
Even respondents from areas where values have seen minimal growth over recent years were inclined to think a significant correction is a possibility.
Although, the survey also revealed that the vast majority of respondents continue to feel that it is a good time to buy property. Over the September 2014 quarter, 66% of respondents felt that now was a good time to buy a property. However, the proportion has fallen from 71% of respondents over the June quarter.
Cameron Kusher, RP Data’s senior research analyst, said that the decrease in those who felt it is a good time to buy is no surprise.
“Most respondents still felt as if it is a good time to buy property, although with the current growth period having run for so long it isn’t a surprise to see a slight fall in the proportion of respondents who think now is a good time to buy.”
The survey revealed that only 52.8% of respondents thought now was a good time to buy in Sydney – the lowest of all the capital cities. Meanwhile, 78.2% of respondents thought that now was a good time to sell in Sydney – the highest of all the capital cities. As Sydney has recorded the strongest capital gains over the last two years, this agrees with Kusher’s statement that home buyers would be cynical about any further capital gains.