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Property Outlook: 2020

28 February 2020 | 6 min read
The property market looks like it's set for a big year!

2020 kicked off with a strong start and a return to form for investors.

With a likely increase in residential construction and historic lows for interest rates now could be the right time to get your foot in the door.

David Robertson, Head of Economic and Market Research at Bendigo and Adelaide Bank: “There were healthy gains in property values in each capital city in January, and strong gains in many regional locations, adding to last year’s recovery.”

Regional variances will always be seen, and the impact of drought and bushfires does add uncertainty to the outlook, but the rebuilding of impacted communities is hoped to add impetus.

The Reserve Bank of Australia is predicting an increase in residential construction activity through 2020, so together with historic lows for interest rates, it promises to be a big year!

How does this compare to last year?

2019 was a year of contrasts – the tail end of a large pullback in property prices, but from midyear a return to the longer-term upswing.

We now appear to be seeing some regions playing catch up on house values, having lagged the larger capital cities for several years.

For investors

After a notable absence in 2019, investors are set to return as a force in the market.

As the RBA noted in February**, a recovery in housing investment is likely to occur in the second half of 2020 in response to lower interest rates, strong housing price growth and population growth; so the recovery in the property market has investors back in play.

**https://rba.gov.au/publications/smp/2020/feb/overview.html

For first home buyers

In 2019, first home buyers were a strong presence in the market, making up about 30% of owner occupied mortgages*.

With various incentives on offer, and record low interest rates, first home buyers have taken advantage of the market conditions to get their foot in the door.

As 2020 is likely to see property prices again increase across the board, incentives like the federal government’s new First Home Loan Deposit Scheme, and state level grants, will be worth keeping an eye out for.

*According to the ABS housing finance data for August 2019.

So, what else can we expect to see in the months and years ahead?

If you’re looking to make a move in the property market this year, here are some noteworthy trends and areas to watch with the largest change over the last 12 months and five years.

We partnered with Core Logic to pick out the top suburbs to watch from each capital city and provide commentary on recent property and lifestyle trends we're seeing shape the property market.

Download the full report.

 

Disclaimer: Any advice provided in this article is of a general nature only and does not take into account your personal needs, objectives and financial circumstances. You should consider whether it is appropriate for your situation. Please read the applicable Product Disclosure Statement(s) on our website before acquiring any product.

In reproducing the supplied data Bendigo Bank has relied on the sources provided to Core Logic.

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Bendigo and Adelaide Bank Limited, ABN 11 068 049 178 AFSL / Australian Credit Licence 237879. Any advice provided on this website is of a general nature only and does not take into account your personal needs, objectives and financial circumstances. You should consider whether it is appropriate for your situation. Please read the applicable Disclosure Documents before acquiring any product described on this website. Please also review our Financial Services Guide (FSG) before accessing information on this website. Information on this page can change without notice to you.

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