Record savings for Aussies, now looking to buy property in 2021 but housing affordability worsens
Real Estate industry commentators, analysers, and professionals are expecting 2021 to have a tremendous upswing effect for the property market as Australians set new records of saving; $110 billion nationally.
Coronavirus may have given the property market a ‘wobble’ during its conception and again for the second wave, however since then prices have steadily improved with predictions of taking off.
While these predictions benefit subsequent buyers of property, entry-level has seen prices increasing faster than others. First home buyers were quick to move on government incentives however the recent surge in interest has had an effect on their prices.
In fact, prices in the lower brackets have been increasing faster than those at the middle brackets, and in some locations climbing double of what can be seen in Melbourne. This indicates first home buyers will have a tougher time getting into the market.
This trend is causing a wave of positivity through the market therefore the key benefit to first home buyers is, hopefully, their parents helping them get into the market under the assumption that now is a good time to buy and assisting with their record-level amounts of savings.
Mortgage Brokers are seeing this type of trend first hand and indicate consumer confidence in the property market is at an all-time high.
However, not everyone in property is riding the positive surge. With property prices increasing, renters receiving assistance, regional and markets booming, and first home buyers receiving extraordinary handouts, there were some who were not so lucky.
CBD’s, offices, and student accommodation markets did see a high level of abandonment, driving down prices. Investors with a Sydney/Melbourne focused strategy also saw difficulty throughout 2020. This may be a result of owner-occupier interest causing volatile pricing increases coupled with rental returns staying the same.
Brisbane suburbs still remain one of the most affordable for first home buyers and investors looking for a stable return. While the Gold and Sunshine Coasts have exploded with interest from Melbourne and Sydney lifestyle migrants, the volatility may be too much risk for investors. Brisbane showing stable, steady increases poises an attractive investment proposition with the Queensland Government committing $3.15 billion in key infrastructure.
The Brisbane City Council website has broken down the $3.15 billion budget as follows:
$1.6 billion to get you home quicker and safer:
- $134.2 million to subsidise public transport across the city
- $125.3 million to deliver Brisbane Metro
- $32.8 million towards purchase of 60 new buses
- $27.2 million on continued investment into better bikeways
- $26.8 million to continue DDA compliant bus stops and ferry terminals
- $24.8 million to complete the Murphy Road and Ellison Road roundabout
- $24.6 million on the Wynnum Road upgrade projects
- $21.2 million for suburban intersection improvements
- $6.1 million on new green bridges
- $3.1 million for free off-peak travel for seniors
- $1.6 million for Move Safe Brisbane.
$1 billion to grow your Brisbane lifestyle:
- $72.5 million investment in Council libraries
- $26.7 million on new iconic and community parks for Brisbane
- $22.8 million on tree planting across the city
- $20 million of CBIC dividend towards a Green Future Fund
- $20.1 million for new sports parks
- $15.4 million on acquiring bushland to increase Brisbane’s natural habitat to 40%
- $9.9 million to deliver aqua parks and refurbished pools
- $8.6 million to support festivals and events
- $1 million to kick off the Victoria Park Vision
- $386 thousand for Koala Research
- $221 thousand for an outdoor cinema in the suburbs
- $497 thousand for a midnight trial at Brisbane square library.
$466.6 million to plan for Brisbane’s future:
- $14.2 million to deliver village precinct projects
- $2 million reduction in fees and charges for small businesses
- $1.7 million to continue the Business Hotline
- $550 thousand for a suburban renewal taskforce
- $284 thousand in small business liaison officer support
- $165 thousand in supporting suburban small businesses
- $55 thousand in supporting start-ups in the suburbs.
This type of spending attracts more migration who tend to live in the city fringe council of Logan, Ipswich, and Moreton Bay.