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If we all had a crystal ball to foresee where the property market will be by the end of 2016, I think we all might be a bit wealthier. Unfortunately we don't, so as property investors, we have to make informed decisions and research the Cities and suburbs where to invest.
There is currently a lot of conjecture out in the media of what the coming year holds. We have heard of interest rate cuts and/or rises, personal debt too high, China in the doldrums, America and Europe stalling in their growth forecasts as well as the property bubble having burst in Australia.
I have recently uploaded rental data for Brisbane and surrounds onto our website. There is now rental data to compare from 2014 and 2015 in various locations around Brisbane. I have also uploaded the latest data from Corelogic which is one of the leading experts about property in Australia. For the latest press release about the property market from the last quarter, please click on the following link. Corelogic press release.Whilst I've always been an optimist about the property market, I think it would be more than ever now true to say, buyers beware. I still believe there are opportunities in the property market to make good money. However, I also believe it is now more important than ever to buy the right properties in the right locations instead of any property in the wrong location.
For those who do not like clicking on links, I have reproduced part of their release in verbatim below. Please note the highlighted section.
"Outlook for 2016
As we move into 2016, it is clear that the strong housing market conditions of 2015 have softened over the final months of the year, setting the scene for more sedate conditions in the New Year.
Interest rates are likely to remain at their current historically low setting, which will continue to stimulate housing demand, however migration rates are continuing to taper which will offset some of this housing demand, particularly in the mining regions, which were previously benefitting from strong rates of migration from both overseas and interstate.
Clearance rates in Sydney and Melbourne slipped from the high 80% mark around the middle of last year to the low 60% range in December. Listing numbers are rising, homes are taking longer to sell and value growth has slowed sharply in Sydney and Melbourne, which were the primary drivers of growth over the recent growth cycle.
Throughout 2016 we may see further moderate value declines in Sydney and Melbourne, however considering population growth has remained strong in these areas and economic conditions are very healthy in these cities, we would be surprised if dwelling values fell materially before conditions start to level.
The city that is showing the most promise for capital gains in 2016 is Brisbane, or for that matter, the broader South East Queensland region. Yields are much higher compared with Sydney and Melbourne, the rate of capital gain has been moderate but sustainable to date, and affordability is far superior to the two larger cities as well. Interstate migration remains positive into Queensland and may start to improve with the higher rate of job creation over the past year. The Canberra housing market has also been showing tentative signs of growing values along with Hobart however, market conditions have been more volatile from month to month in these areas.
The regions that are likely to underperform are those associated with a higher degree of economic uncertainty. The Darwin and Perth housing markets peaked in late 2014 and both home values and rental rates have fallen over the past year. The rate of decline may start to ease in these cities; however growth prospects are likely to be at least a year away in these markets. The Adelaide housing market has remained relatively steady over the year, with values virtually unchanged in 2015. However, as the automobile manufacturing sector continues to wind down in the region, coupled with the soft resources sector, the economic outlook for the city isn’t likely to have a positive influence on housing market conditions in the area.
Along with the many other economic variables and factors, the changing regulatory environment is yet another factor likely to influence the market in 2016, particularly proposals released just prior to Christmas by the Basel Committee to levy higher capital on investment loans." Corelogic
As I had indicated last year in a newsletter, Brisbane is still the place to invest. Certain suburbs of Brisbane are way under value and have potential of enormous capital growth in the coming years. The following link will take you to the article mentioned. Why Brisbane is a great place to invest. (Remember the approval for the Queens Wharf Casino)Our property management services are available throughout Brisbane and surrounds. Call Chris (owner) or our new Business Development Manager (BDM) Daneen and see how we can assist. Free rental appraisals are always available throughout the greater Brisbane area.