More than ever, Australians are relying solely on future home prices for their financial stability and, in a surprise twist, property owners say they would benefit from lower house prices.
That’s according to an ME Bank survey, which showed that 43 percent of respondents are “reliant” on future house prices either falling or increasing and around 10 percent are “completely reliant”.
Where it gets really interesting is that only half of homeowners (49%) wanted house prices to rise, with around 24% wanting prices to fall.
And while 55 percent of investors wanted to see real estate prices increase, a whopping 20 percent also saw benefit in a price fall.
Similarly, less than half of investors (47 percent) were reliant on house prices “presumably increasing”.
Not surprisingly, 51 percent of Millennials (25-30 year olds) said they were reliant on the future of house prices compared to 30 percent of Baby Boomers (55-74 year olds).
Does this mean less confidence in the housing market?
The survey indicates that more Australians are certainly re-evaluating what they believe the real estate market will do in the coming years or, at least, what they’d like it do.
More homeowners were willing to see a fall in prices and, more telling than that, 97 percent agreed that a price fall would help resolve the housing affordability crisis.
ME Bank general manager home loans and personal loans Patrick Nolan said it was a sign of the traditional “two camps” of property prices being flipped on its head.
“With house prices disrupting the dream of homeownership and the benefits that brings, views are changing,” he said.
“That property owners were willing to see asset values fall is a sure sign house prices had reached peaks many think are unfair.”
Of course, there’s no way of telling whether we have indeed reached a “peak” in house prices.
In fact, we previously extrapolated historical data to work out what the median house price would be for every capital city by the year 2024.
So should I wait to buy a property?
Unfortunately, for first home buyers, there’s really no reason why $1 million listings won’t become the norm (#sadface).
So the million dollar question is should you buy now or save more?
Our purchasing cost calculator may give you some answers.
It’s also to remember first home buyer benefits like the First Home Owners Grant (FHOG) and stamp duty concessions.
If you don’t quite have a large enough deposit, you may also qualify for a guarantor loan or another no deposit solution.
First home buyers have plenty of help and the government is trying to do more all the time.
On the flip side, investors are facing tougher lending restrictions with some lenders pulling out completely (at least for the time being).
No one can tell you when it’s the right time to buy a property but our mortgage brokers can properly assess your situation to find you the right home loan for your needs.
If you’re looking to enter into the property market and you’re struggling to save up a deposit, speak with one of our mortgage brokers.
Call 1300 889 743 or fill in our free assessment form today.