Tougher competition is a hurdle property buyers across Australia are expected to face this mortgage season, new research has revealed.
The latest report by one of Australia’s biggest comparison websites, finder.com.au, has noted that housing supply will exceed demand this year, but it won’t dampen competition in the market.
After studying the population growth and the housing market over the past 15 years, finder.com.au predicts 72% more properties are expected to be built this year than population growth would consume.
The website also said that the end of 2015 will see a total of 207,970 new properties to be approved for construction, as based on average growth of 3% for the past 15 years. The study also found Australia’s population to increase by 314,952 to 23.94m people, which means 121,135 households will be needed.
“With mortgage season around the corner (starting September 1), competition will remain just as tough as we’ve seen over the past year. Despite more new properties being built, house hunters can expect no relief with properties being snapped up fast and prices rising across many areas of Australia”, said Michelle Hutchison, Money Expert at finder.com.au.
“And it’s only expected to get worse. If a 3% growth trend for new properties continues, along with the projected population growth, this oversupply will decrease to 32% next year, and will stay below 40% through to 2018, according to finder.com.au.
“With less oversupply for new properties expected to be built over the next few years, it could lead to a more difficult climate for property buyers as buyers will face a reduced availability of housing stock, meaning more competition and possibly higher prices.
“So if you’re in the market for a property, it could be better to jump in now rather than waiting for next year as it looks set to be even tougher.”
It can be confusing to know whether to get a variable rate or fixed rate mortgage, and what features are important. That's why it's important to not only check the right rates, but make sure that you're getting the right features in your home loan. Get help choosing the right home loan