Strong housing market to take off in 2021
The coronavirus has caused huge and drastic changes worldwide. Many people have been affected by the pandemic-induced recession – lost jobs and livelihood. According to industry experts, almost $110 billion was saved due to the lockdown that was experienced early this year. In Australia, since the new Covid-normal was implemented, both the health and economic crisis brought by the pandemic has improved steadily.
Housing affordability has been a huge issue in the country, and while the economy has actually improved in the last few months, it remains to be a concern among mid to low-income earners. For instance, entry-level property prices according to the latest study are rising faster than other markets in some of the largest cities in the country. This makes it really difficult for first-time homebuyers to reach the Great Australian Dream of homeownership. Seems like the cheapest properties are seeing new price hikes.
But despite this new information, industry experts are saying that things are looking up in Australia.
But the truth is, the economy is now considered out of recession and auction clearance rates are said to be steadily rising. These two things are motivating Australians to take a look again at properties and even consider push through with buying property, which would definitely play a huge role in the building and construction industry.
In the past four months, low-interest rates plus cashed-up households were reportedly fueling price growth. Lending has increased rapidly as well. But these do not stop consumers from acquiring property, and their willingness to pay for an asset is increasing. It indicates that the building and construction industry will continue to remain strong – and even stronger going into the new year.
The Australian Bureau of Statistics showed that in October this year, new home loan commitments rose to 0.7 percent to $22.7 billion. In fact, many are showing interest in investing and entering the market next year. Parents are even helping out their children to get into it. The confidence among potential buyers is really astounding, and people who were able to save up during the lockdown are returning.
A survey was conducted that showed the strength of the Australian housing boom in November – from 32 percent to 132 percent. This was considered a 7-year high for the index. People were found out to be saving up for two things: buying a home and going on a holiday. With the rise in interesting consumers, forecasts are pointing to an even stronger housing market in 2021, with so many not wanting to be left out and miss on good deals. This should be very good for the building and construction industry, and of course the economy.