This is always the hottest topic in most people’s minds, regardless of whether they’ve already bought some property or are looking to buy in the coming year. So what’s the answer to will the property market rise in 2016?
While you should be across what people are saying about the property market, you should take it all with a grain of salt. I appear in the media regularly providing commentary but so do many other property professionals and sometimes it can be a bit confusing when someone is saying one thing and another person is saying something else. Many people in the media talk generally about the property market but they might have a vested interest in persuading you to think a certain way. With this in mind, it’s important to make your own decisions about what is most relevant for your needs.
I, like you, am looking at the market from a personal perspective as an investor, rather than as a business owner, as that’s where I create my real wealth.
I know that there’s more than one property market and each market operates differently. Even if they forecast growth at zero, I know that some properties might drop by 5-10 per cent, whilst others might rise by 5-10 per cent giving a net result of no growth.
From having a team of specialist buyers agents on the street, I know that there’s virtually no stock of median priced units in Sydney’s blue chip inner city suburbs. There’s hardly ever been any stock in that market since I came to Australia almost 20 years ago, even in the GFC. I know that over the last few years we’ve had two to three times the normal amount of clients on our books and that has continued in 2016.
In my experience, that continuing lack of supply and ever increasing demand leads to price growth, no matter what people say about affordability. I don’t believe a change in foreign buyers will make much difference to our particular segment as foreign buyers can’t buy second hand properties and choose not to anyway.
One of the independent researchers I get advice from is Louis Christopher from SQM Research and his predictions were between 4% and 9% for Sydney. And being an average that means some areas might do zero whilst others do 10-15%.