Posted June 25, 2018 06:38:37 The property market in Australia’s second-largest city is in danger of bursting into a second wave of speculative activity as the market recovers from the devastating wildfires that devastated the state last year.
Key points:The Sydney house market is in the throes of a second-wave of speculative housing activity after the devastating fires last yearA key factor behind the market’s second wave is the government’s policy to cap interest ratesThe Australian Real Estate Institute has warned there is a potential for an even larger housing bubble to emerge in the future if rates are not loweredThe boom has been fuelled by a strong property market, the report saysThe report, published on Wednesday by the real estate institute, says there is potential for a second boom in the housing market in Sydney.
Key Points:The property market is currently in the midst of a “second wave” of speculative property activity after a devastating wildfires last yearThe state government’s cap on interest rates, which began last year, has been blamed for a rise in the number of home salesThe report found the market in the city of Sydney is in a state of flux.
“The housing market is facing a new cycle of speculative homebuilding activity and the government has taken steps to limit the impact of that activity on the market,” it said.
“This may well result in a second bubble.”
It noted that the cap on mortgage rates has had a “positive impact” on property prices.
The report said there were “real concerns” about the property market as a result of the caps, but that it is not the only factor driving speculative activity.
“While a cap on housing interest rates has been a key factor in the current housing market, a cap that is applied across the broader market would increase the risk of a bubble, it said.”
A spokesperson for the Australian Realestate Institute said there is nothing wrong with a bubble emerging from the housing bubble, just that it has not happened yet.
“The report notes that a ‘second wave’ of speculative housebuilding is a key component of the Sydney housing market.
This could result in more housing bubbles if housing demand continues to grow,” they said.
In a statement, the Australian Institute of Housing Development (AIDD) said: “The housing bubble is not new.
It has existed for decades.
As a result, it is time to stop talking about the housing boom as if it were the latest financial crisis and start talking about it as a crisis of housing affordability.”
Topics:housing-industry,housing,market-and-regulation,pricing,business-economics-and,government-and/or-politics,housing-and_housing,sydney-2000, sydney-2040, nsw, australia, qld, nt, brisbane-4000, qnd, tas, wa
