A shortage of housing stock and rising rents will encourage investors and first-home buyers back into the property market, according to the latest Australian Housing Snapshot from ANZ Research.
The report shows that while housing market sentiment has softened and prices have drifted lower in most capital cities, the strength of the Australian economy will bolster a recovery.
Declining auction clearance rates and rising days on market reflect the mismatch between buyer and vendor expectations. However, the absence of wide-scale 'forced' selling has, to date, protected measured price outcomes. Weak sentiment will see house prices continue to drift sideways to lower over the coming 6-12 months. Nevertheless, a rebound in economic growth in 2012 and 2013 should limit the fallout. Moreover, housing market fundamentals continue to tighten and near record low vacancy rates will eventually drive a renewed acceleration in rents that should attract investors and first-home buyers back into the housing market.
While South Australia's housing market continues to remain broadly in balance, tight rental market conditions and a solid pipeline for major mining and energy projects should drive increasing pressure in the years ahead.
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