Prices 'strong for the current market'
One week out from the federal election and one interest rate rise behind us has led to the property market easing as expected.
By Ian Pepper of Ray White Helensburgh
One week out from the federal election and one interest rate rise behind us has led to the property market easing as expected.
The past weekend had no auctions in 2508 or 2515, however, a number of sales occurred just prior to the weekend, mainly in Helensburgh. Some of the prices achieved were still strong for the current market. For example, a new townhouse at 30A Hume Drive, Helensburgh (4 Bed, 2 Bath, 1 Car) sold for $1,245,000.
From here the market is most likely going to pause while we get this election out of the way, especially now the government has put their pitch forward to voters regarding housing affordability.
The Morrison government announced that first-home buyers will be allowed to access their superannuation to buy a home and younger downsizers will be allowed to contribute sale proceeds of their home to super. The latter scheme to boost supply of housing, presumably for the first-home buyers to purchase. However, downsizers usually compete with first-home buyers for the same properties, so it is not clear how well this will work overall and if it will just put more pressure on prices.
A few more details on the first-home buyer scheme:
- Up to 40% of super, capped at $50k
- Must to returned to super later when property is sold, including a portion of the % gain on the property
- Must have 5% deposit and live in property for at least 12 months
- Couples can access scheme, individually accessing their super if both eligible
Alternatively, voters have the option of the Labor scheme for first-home buyers whereby the government will take an equity stake in your property and be a part owner. This could be up to 40% for a newly constructed homes or 30% for an existing home. A deposit of only 2% is required and when the property is sold the government gets their share back, along with any percentage increase in the capital value of the property. Likewise it shares in any percentage loss on the property.
In addition to these schemes, both parties also have a variation to the existing Home Guarantee scheme whereby first-home buyers with 5% deposits can escape the need for lenders mortgage insurance if they meet a long list of criteria.
I could write on for pages and pages comparing these schemes, however, will wait to see the result next week and let you know more details on which path we will be going down and any expected impact on the real estate market. In the meantime, happy voting!
About the author
Ian Pepper has had a long and distinguished career as a finance and real estate professional. Originally trained as a Chartered Accountant in 1995, Ian worked in Sydney and London. He has an MBA from Macquarie Graduate School of Management and now sells real estate with Ray White Helensburgh. Ian also volunteers with local community groups including school P&Cs, sporting clubs and business chambers.
