Australia’s property sector looking bright.
With recent changes in major policies, Australia is on the verge of another housing boom. Smaller capital cities like Perth are likely the ones to benefit the most.
In September of this year, Treasurer Josh Fryndenberg spoke of scraping the responsible lending laws introduced after the GFC. This lending reform will make it easier for consumers and small business owners to get bank loans. The paradigm shift to the reform will remove lending obligations from the Australian national credit act; making it ‘borrower beware’ instead of ‘lender beware’.
Former ANZ chief economist Warren Hogan applauded the reforms by calling them ‘sensible’.
After the announcement of reforms, SQM Research founder Louis Christopher has stated that the rethink on RBA’s policy will keep housing price ‘artificially high and effectively overvalued.’
In a recent report published by SQM Research, the national rental vacancy rate has declined to 2%. Also in the report, Perth rental vacancy rate has dropped to 0.9% in Sept. 2020, same time last year the vacancy rate was at 2.7%.
With less availability, rental prices will see an increase between 6.8% to 7.6% over the course of 12 months.
The government stimulus incentives coupled with low interest rates, declining rental vacancy and shortage of land and development projects, the state will see property prices increasing in 2021.
For investors across Australia, now is the time to invest in Western Australia as both the state economy and the property market take off for a brighter future in 2020.
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