To buy or not to buy? Melbourne’s Residential Market in 2012
The current outlook for the Melbourne residential market for 2012 is mixed at best. New construction completions are predicted to fall by 10%, development funding is predicted to tighten, & there is a growing reluctance to invest caused by the uncertainties created by the European soverign debt crisis. The Australian residential market is continually referred to as one of the most overvalued in the world, yet it continues to hold up relatively well falling only slightly in 2011. On the macro level however, the underpinning fundamentals remain quite strong. We have low unemployment, strong population growth, low vacancy rates, a declining interest rate environment, & strong GDP growth. Whilst the days of double digit growth may have passed, given the fundamentals, it is difficult to forsee any major upheavals in the year ahead.
By Bill McHarg, Director of The Property Advisory
