Stronger clearances flag more investors
Stronger clearances flag more investors
Posted on Thursday, June 20 2013 at 10:01 AM
Sydney’s auction rate for the first full weekend of winter demonstrates strengthening confidence and increased investor activity, according to Australian Property Monitors (APM).
The
market analyst says the 76.9 per cent clearance result is more than 20 per cent
higher than the result for the same weekend last year, and the figures continue
a trend from the Queen’s Birthday Weekend, which recorded a similar increase on
its 2012 clearance figure.
According
to APM, the Sydney weekend
auction market is now tracking higher than in the same period during the boom
period of 2010.
Andrew
Wilson, a senior economist at APM, says the normal yearly seasonal factors are
being overridden by other influences.
“The
cycle is strong at the moment because we have historically low interest rates
and we’ve got a recovering market so there’s a clear sense that prices are
rising and confidence is back as well.”
Wilson
says there are a significant number of investors in the market and momentum is
driving growth.
“It’s
that perception of a rising market, the opportunity to get established in the
market and to accrue those medium-term capital gains.”
“Nearly
40 per cent of all residential investment activity is centred in New South
Wales and NSW has had about a 30 per cent lift in the level of investor
activity, based on ABS (Australian Bureau of Statistics) finance data, for the
first four months of this year compared to the first four months of last year.”
Wilson
says the results are starting to be mirrored in other markets across the nation
too.
“Melbourne,
Sydney and Perth are rising at the moment quite strongly. We release our series
in a couple of weeks and expect to see price rises confirmed for the June
quarter in most capital city markets.
“There
is this flight to bricks and mortar in Australia given those low bank deposit
rates and the underperforming, volatile local sharemarket.”
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