Data reveals two-tier property market

Font size :
Prospects are grim for lower income homeowners, according to March quarter housing data from Australian Property Monitors (APM). Its data shows that a two-tiered property market is developing in the large capital cities, driven by the less affluent areas struggling to cope with interest rate rises and exacerbated by the premium market riding high as investors redistribute share market wealth into property. Michael McNamara, operations manager for APM, said: "It's lamentable that, whilst premium markets are booming, a further rise in the cash rate will disproportionately affect lower income earners. Premium property markets will largely take increased interest rates in their stride, but many less affluent mortgage holders will go to the wall." McNamara believes that re-possessions, forced sales and bankruptcies will increase, following the extra burden of higher mortgage repayments as last year's three interest rate hikes take their toll. "This is likely to create greater social division. Confidence will continue to undermine less sought after areas, as the spectre of more interest rate rises this year looms large," he adds. The report showed that Sydney property overall recorded negligible growth in the quarter but some premium areas, like the north shore, ran hot growing at 9% per year. Data showed that Sydney's southwest continues to decline as mortgage holders are forced to sell up. The price of units in the city fell 2.5% in the quarter to sit at an average price of $350,328 while housing remained at $524,926 on average. Premium areas in Melbourne have boomed, according to the report, with the top third of the market growing by 16% in the last 12 months. Unit prices remained stable, averaging $284,185, while house prices increased 2.1% from December to $375,556 on average. Brisbane growth has reached a peak and will consolidate, while Perth and Darwin have recorded the first quarterly decline in six years. Brisbane unit prices declined 2% to $266,411; prices declined 0.7% in Perth and managed a gain of 0.8% in Darwin. House prices moved ahead 1.4% in Brisbane and 0.2% in Perth, but Darwin saw a decline of 0.9%. The report predicts a buoyant market in Adelaide, with growth exceeding 10% in the coming year. Unit prices increased by 3.4% in the quarter to $217,275 on average, while housing growth was more stable, moving on 1.7% in the three month period.

With interest rates at their lowest for more than 50 years, there are some great rates available. The best thing to do is to compare rates from all the lenders. Let us help take the leg work out of doing this - Compare Home Loans now

Mortgage News and Articles

How to tell when a housing market is cooling How to tell when a housing market is cooling

You need to check clearance rates, listings, and the price gap, among other factors Read more

Growing demand for green apartments in Sydney Growing demand for green apartments in Sydney Both owner-occupiers and investors favour eco-friendly buildings for their energy-saving features and reduced environmental footprint ... Read more

Are property investors as rich as they appear? Are property investors as rich as they appear? A multi-property portfolio doesn’t guarantee easy millions ... Read more

Be proactive about getting a better mortgage deal Be proactive about getting a better mortgage deal Apathy could be costing you a considerable amount of money over the lifespan of your loan ... Read more

More mortgage news and articles

Sponsored Links

Wednesday, Sep 20, 2017
Top Featured Rates
Top Bank Rates

Get help choosing the right home loan

Let us help you find the right home loan for your needs.

Tell us a bit about your circumstances:
  • Purpose of mortgage
  • Household Income
  • How much do you want to borrow?
  • How much deposit do you have?
  • How much is your house worth?
  • How much do you still owe on your mortgage?
  • What type of mortgage do you have?

  • How much is your new home?
  • How much do you want to borrow?
  • How soon do you want a mortgage?
  • First name
  • Last name
  • Where do you live?
  • Phone number

Special Offers

Related Keywords