This article is from the Australian Property Journal archive
BOASTING suburbs where buying is cheaper than renting, residents in WA and SA are more optimistic about purchasing a home in the current market than the rest of the country.
The number of Australians who believe it’s a good time to purchase a home has fallen over the second quarter, according to the latest research from NAB.
While in Q1 40% of surveyed Australians thought it was a good time to buy a home, this figure has fallen to 29% in Q2.
With the number of Australians with intentions to buy a home over the next 12 months reportedly also falling slightly in the second quarter, at 13%, compared to 15% in Q1.
Meanwhile intentions for investment properties remained stable at 9% over both quarters.
“House prices are rising but there’s still plenty of opportunities for Australians to buy their dream home rather than rent it. The simple reason for this is the record low rates on offer, with many mortgage rates still coming with a 2 in front of them,” said Andy Kerr, executive, home ownership, at NAB.
The market is most ripe for prime purchasing and investment opportunities in outer-metro suburbs, as well as for inner-city apartments, with interest remaining highest for first home buyers.
“Record low interest rates and first home buyer incentives like the First Home Loan Deposit Scheme have driven strong demand,” said Kerr.
First home buyers are also continuing to benefit from unprecedented workplace flexibility, making not only outer-suburbs more of an option, but also tree changes to regional areas.
“Property prices have not risen as much in outer-metro suburbs and first home buyers are very good at picking up on where property prices have been more subdued. The correlation between outer-metro suburbs and buying new builds is certainly playing through in finding a bargain,” added Kerr.
Both South Australians and Western Australians are most optimistic about buying a home in the current moment, at 35% and 36% respectively, Victorians were also feeling relatively optimistic at 32%.
While Queenslanders were feeling the least optimistic, with only 23% thinking it’s a good time to buy, followed by the ACT with 24%, Tasmania with 25% and NSW with 26%.
With SA residents also dominating interest in buying an investment property, at 28%, followed by ACT at 27%, WA, Tasmania and Victoria at 26%, NSW at 25% and Queensland again last with 22%.
NSW led intentions to purchase in the next 12 months at 15%, followed by ACT and WA residents at 14%, Victoria at 13%, QLD and SA at 11% and Tasmania at 10%.
Investor interest for the next 12 months was lower again, with ACT most interested at 13%, NSW at 11%, Victoria at 10%, SA at 9%, Tasmania at 8%, WA at 7% and QLD at just 4%.
Excluding Sydney and Melbourne, where the price difference in buying and renting in certain suburbs is marginal, all other states and territories have suburbs where the benefit of buying is clear. This is most evident in Perth, Adelaide and Brisbane.
Suburbs where there is opportunity to make a purchase more affordable than renting Perth, include Armadale, Greenfields, Port Kennedy, Clarkson and Baldivas.
Whereas in Adelaide these opportunities are most evident in the outer north, in suburbs such as Elizabeth and Salisbury.
In Brisbane it is mainly to the north and west of Greater Brisbane, in areas including Logan, Bald Hills, Redbank Plains, Redcliffe and Caboolture.
In Hobart, a mortgage would be cheaper in Glenorchy, which is also the only place cheaper to buy a unit than rent it, Sorell, Howrah, Moonah and Kingston.
Darwin suburbs meeting this criteria include Zuccoli, Gunn, Durack and Leanyer for houses and Darwin City, Stuart Park and Larrakeyah for units.
40 suburbs in Canberra make the cut, with Kambah, Ngunnawal and Bonner for houses and Braddon, Belconnen, Franklin and Kingston amongst the most popular.
In Sydney, for units Campbelltown, Liverpool, Blacktown and Penrith all provide a good opportunity.
And in Melbourne the unit market in Carlton, Melbourne CBD, Southbank, Docklands and Abbotsford provide opportunities for buying over renting, with housing options available in Melton and Melton South.
