The demand side of the residential property market receives a lot of attention however, there are three simple ideas that more often than not drive demand. They are divorce, death and debit all three are linked into big demographic changes that influence the demand for a majority of buyer and seller motivation. Looking for trends associated in each can help unlock trends. The ideas are not complex, but they do offer insights as to how the market is trending.
What Worries Buyers?
Appreciating how wider demographics impact buyer demand there’s another aspect to markets and that’s what worries buyers when they consider buying a new home. There’s a lot of research on this topic and it appears the most buyers still see an amount of financial risk associated with a purchase. That risk extends to protecting cash equity and the cost of future maintenance. Another risk is associated with the idea of co-ownership with family and friends and despite the ability to share costs, co-ownership in Australia is still not a popular idea. On the reverse side of what worries buyers, most are happy to buy at auction as reflecting a fair price but, remain concerned about interest only loans, again because of the potential future financial risk.
UK Tackles Housing Supply
This week the UK released its new budget for 2019 with housing a policy feature, in particular how additional supply might be encouraged. The UK government has a policy that aims to deliver 300,000 new homes a year. An interesting feature is the role of local councils, or the supply of ‘council housing’. In the 1970’s local councils accounted for 40% of supply, but no longer. Part of the budget plan is to allow local councils to borrow more funds to help deliver 100,000 new homes from a debit pool of £15 billion. However, its suggested that this policy might limit private development and not deliver the target volume of homes.
In almost every country, Australia included foreign buyers are not popular, in New Zealand sections of the market are even a no-go-zone for off-shore buyers. The impact has often been hard to measure and some recent research from the UK is notable. In the UK it’s been estimated by new research the British house prices have been driven -up by 20% over the past 15 years because of the huge amount of foreign capital invested. However, there has not been any comment on the flow-on benefit to the UK economy from this investment. Negative press in this area is often a one-sided and emotive, the subject is much more complex.
This is a topic that just get better and more interesting as smart appliances become more mainstream. Soon the fridge will also allow you to use those leftovers in the fridge and save money. The idea that a fridge might manage the food and drink you use is not new however, there’s a new innovation. Out shopping, just call up an app on your phone and see what’s leftover in the fridge, the odd bits of leftovers or takeaways that more often than not find their way into the rubbish bin or compost, but no more. Your smart fridge will send recipe suggestions and a list of ingredients, right to your smartphone while you roam the supermarket. So that you can return home and cook up a storm and use all those leftovers, and also safe money.
Sydney Metro Reaches Martin Place
Anyone working or living in the City of Sydney should welcome news that the Sydney Metro is taking place right under Martin Place. Currently there are two road header tunnelling machines hard at work underground at the future Sydney Metro’s Martin Place Station site. Work is taking placed around the clock 18 metres below Castlereagh and Elizabeth Streets. Work is on target to finish the underground station caverns before two tunnel boring machines reach the site next year. It’s a big task with 52,500 tonnes of crushed rock removed from the site; which is being re-used, including at the new Sydney Metro site at Barangaroo. The station cavern walls are supported with 2950 rock bolts set with 37,000 litres of grout and 1,200 cubic metres of sprayed concrete.