Well I have a lot of information to pass on since it’s been a while. My best friend Bec, a Penrith Mortgage Broker joined me recently to look at the top points of concern with the Penrith property market, and what it means for home owners and investors looking to refinance their home loans or investment loans.
As we all know the Sydney property market is booming, but when is it going to end.
First point to make is that I can see vacancy rates in Sydney is going to reach the 2.5 percent mark. Truthfully we believe that we’re going to get closer if not reach the three percent mark.
Western Australia has is already experiencing a huge increase and we see them right up to 5.6 to 6 percent which is quite a significant jump.
The next is that brand-new home developments are going to drop in value by ten to twenty percent. I have a running bet with some of my close colleagues that believe otherwise, but I’m extremely positive that we’re visiting this drop as early as March in 2016.
So keep your eyes on this one area as this is going to be an intriguing one because many retirees have settled into self manage super funds and in addition to investors that have followed the Chinese or other cities in the United States is that at all have bought into property that is well over- priced specifically in the Penrith area.
My third prediction is that there are going to be more would be developers that are going to default on their development loans and there’s going to be substantial carnage through this small group of property investors unlike what we’ve seen in previous market slumps.
These problems will rise because a lot more developers have actually handled larger sums of capital to carry out these developments and then carry them onto the marketplace they think is going to remain hot until 2017.
I believe my top prediction is around the real estate agreements, more specifically the type in which these brand-new developments have been marketed and sold.
I think that financial institutions and governing bodies need to examine the contracts that had been written for the sale and on the rental guarantees that have actually been provided to potential purchasers. It will remain to be seen if financial investment markets start to rely on these rental assurances.
I bring a rather interesting point to hand regarding the drop in yield rates investors will obtain. My initial figures are decreases of around 25% with rental yields in Penrith, Sydney. I strongly believe that I within 6 to 8 months we will start to see properties in these areas be leased for anywhere in between 420 to 450 per week. Mortgage Brokers in Penrith will start to see a drop in investor loans for that reason.
So these are my top predictions for how the Penrith housing market, will stand up over the course of 2016.
Penrith Mortgage brokers will need to get creative when dealing with a fierce market, as I predict there will be less people looking for home loans in Penrith.