The recent Federal Budget gave the housing market a bit of a boost in the first weekend after it was brought down.
Auction clearance rates rose in Sydney and Melbourne but it remains to be seen whether the trend will continue given the uncertainty leading up to the Federal election scheduled for May 18.
There has been a lot of conjecture around Labor’s plan to scrap negative gearing on new investment in established housing – a move it says will make property more accessible for young people and first home buyers.
My gut instinct says this is unlikely to be the case in Cottesloe-Swanbourne- Mosman Park because the high median prices for family homes tend to be beyond the reach of most first home buyers anyway.
I strongly agree with REIWA when it called recently for stamp duty to be scrapped on property sales. Let’s face it, this would immediately reduce the cost of buying a first home or any other home by tens of thousands of dollars and not have the damaging effect on property investment that could result from Labor’s proposal.
However, another way for young people to get into the western suburbs is by lowering their sights from large family homes to apartments and townhouses and villas.
In fact, I have noticed this trend myself in recent years where young couples have decided to make their first home a flat or villa close to the beach and all the amenities on offer in the western suburbs. Rather than go to outer metropolitan areas where they can have a four by two home for the same price but little else in the way of amenity, they prefer to stay close to family, friends and workplaces.
I currently have listed four such properties and each of them would make an excellent first home for young professional people or indeed downsizers for empty nesters.
5/187 Broome Street, Cottesloe
219B Broome Street, Cottesloe (Villa)
4/22 Salvado Street, Cottesloe (Townhouse)
82ANapier Street, Cottesloe
Downsizing is only going to get bigger as the baby boomers reach retirement. Right now there are roughly 23 million Australians and one third of them are aged 57 or older.
A recent Seniors Housing survey showed that 95 per cent of those asked would consider downsizing at some stage but the survey also revealed that a majority of people wanted to stay in their old neighbourhoods close to family and friends.
Downsizing by definition means moving into something smaller and most people want to have a decent amount of cash leftover when they do it to complement their retirement savings.
Unfortunately, the recent Budget didn’t see fit to quarantine cash left over from downsizing in retirement from impacting on the age pension but I’m sure pressure will continue to build on governments of all persuasion on this front..
Figures just released show that prices in the WA housing market overall fell by 2.8 per cent last year although falls in regional areas was the biggest contributed to that.
Luana Kenny, m3property’s national director residential development, said in a recent article that many of the issues currently weighing on the market would begin to ease after the Federal election.
“There are a number of factors impacting the residential market at the moment leaving most home buyers and investors, and indeed economists, scratching their heads, but a lot of those issues will dissipate over the next 12-18 months,” Ms Kenny said.
“What will remain is strong housing demand, driven by continuing population growth, and a return to supply equilibrium. From there we are going to see the market begin to grow again and that will mean decreased vacancy and increasing pressure on median dwelling prices.’’
Hallelujah to that!