All the pundits, faux experts and property gurus have awoken and are now making their 2017 property predictions, so at Aitken Real Estate we thought we would join in the fun and have a go as well…
There’s some buyer nervousness of potential interest rise. The banks will be looking to increase rates due to the cost of borrowing related to Australia’s credit rating, which may in turn impact the rate of growth seen over the last year or two. We will likely see the market steady and increase prices, but at a lower rate of growth than the last few years. Having said that, interest rates in general may come under pressure to decrease due to a potentially faltering economy linked to China and USA. All that may mean is our economy staggers along with low growth and (hopefully) a steady low interest rate.
It should be noted the property sector is like the share market in some ways. Different suburbs enjoy popularity due to a range of factors, including infrastructure (public transport, schools, etc.), whilst others, although solid performers, don’t enjoy the same love. Therefore, you have different suburbs often having different rates of growth and areas within the suburb can also have dramatic price differences as can the rate of return of investment for potential landlords.
Apartments will continue to sell well in 2017 as they are often taken up by those trying to get a hold into the market. However, there are real dangers of an oversupply in some suburbs, forcing existing potential sellers to re-evaluate what they believe their existing property might sell for.
We believe Aitken Real Estate’s core areas of Bayside, including Highett, Cheltenham, Dingley, Beaumaris, Mentone and Mordialloc, will achieve better than average growth. Local infrastructures, including AFL Hawthorn Football Club’s new home in Dingley, the new MCC Sports High School in Beaumaris, the removal of level crossings in Cheltenham and the new railway station at Southland, will enhance these suburbs that are highly sought after.
Single storey front villas, two storey town houses with master bedrooms downstairs, potential development sites (particularly corner sites) and homes with renovation potential already enjoy a back log of buyers, ensuring upward pressure on prices.
I think it’s fair to say that 2017 will have its share of ups and downs, but we’re looking forward to seeing how it will all play out in the year ahead.
