Green shoots are now appearing in the property market in Melbourne’s west as consumer and buyer sentiment steadily improves following a hold on the last two Reserve Bank of Australia (RBA) interest rate calls, according to the Oliver Hume Real Estate Group.
Mambourin is one rapidly expanding suburb that is witnessing an upturn in buyer activity, across established homes and land sales over the past three months.
George Bougias, National Head of Research from the Oliver Hume Real Estate Group comments, “Consumer and buyer sentiment has been challenged due to higher interest rates and inflation but is expected to gradually improve over the remainder of 2023 and into 2024, especially as interest rates stabilise and begin to decline. We are already seeing green shoots in many of Melbourne’s western suburbs such as Mambourin.
“The direction of interest rates remains the key factor likely to affect the residential land market going forward despite the RBA leaving the cash rate target unchanged at 4.10% at its most recent meeting in early August. Analysts differ on the future path of interest rates however an increasingly common view is that we are at (or near) the end of the RBA tightening cycle.”
“Residential land sale volumes in Melbourne remain at low levels, although in recent weeks we have seen a steady improvement, especially in well located masterplanned communities. This improvement, particularly in Melbourne’s west, has been driven by record population growth, growing pent-up demand and growing housing shortages (plus rental pressures) and the use of incentives and rebates,” said Julian Coppini, Chief Executive Officer – Project Marketing at Oliver Hume Real Estate Group.
“The ongoing rebound in the established property market and property price increases are also drivers of the steady rebound in residential land sale volumes. Upsizers and downsizers, especially second home buyers, continue to underpin demand.”
Julian added, “First home buyers continue to face serviceability and affordability challenges but are expected to gradually re-enter the market over the next six to 12 months as interest rates stabilise. Land market activity is expected to continue to steadily improve over the course of 2023 as underlying demand and housing shortages grow.”
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