With the recent price growth across Sydney, buying a property has never been more expensive. For a number of years, some analysts have been predicting the bursting of Australia’s housing bubble.
However, Shane Oliver, Chief Economist at AMP has explained,
“Usually in a bubble you get a combination of easy money and lots of optimism about future growth. Certainly that’s what Australia saw at various points over the last decade or two, particularly in Sydney. We certainly had a house bubble up until 2003/04, when we had easy money, but since then prices have gone sideways due to tighter lending and affordability constraints.”
Other factors underpinning the current Sydney housing market include the rising population in stark contrast to a chronic undersupply of new homes. We also have an ageing population with people living longer in their homes. This slows down the turnover of established properties.
“Next year if interest rates go up, it will cause a dampener in price growth. It’s not going to cause a crash in the property market”, says Oliver. “Worsening affordability is certainly a problem especially for first home buyers who are being squeezed out of the market. But I still can’t see a trigger for a crash.”
In the meantime, property prices continue to rise and if you buy a property next year, it is likely to be more expensive than it is today. So it makes perfect sense to buy property now if:
- You are ready to buy and have access to finance.
- You can afford to buy.
- You are not over-extending your personal finances.
- You are buying the right property at the right price.
To ensure you are paying the right price for your next property, consider using the services of an award winning buyer’s agent. Call Buyers Domain today on 9568 6330