With Christmas on our doorstep we are already casting our minds toward 2020.
Looking at the macro economy we are witnessing an array of mixed signals, for example strong labour markets and consumer spending vs a drop in global trade and manufacturing. At the forefront is the ongoing trade war between the US and China.
The data hints towards a 'weakness' that will likely result in a slowing of global GDP. What does this mean for australia? September 2019 figures show Australia's economy slowing to its most sluggish pace in a decade, with a GDP growth of 1.4%. The Aussie economy has lost momentum and soft consumer spending is the main culprit. As a consequence we are likely to see further interest rate cuts as well as continued spending on infrastructure projects.
But its not all Grinchy News...
With interest rates at historical lows and improved affordability the outlook for 2020 for property looks positive. The capital cities property price index rose by 4.6% over the past three months. Values have recovered by 5.7% since bottoming out in 2017.
Our view is that a variety of factors are supporting the gains in housing values. The synergy of a 75 basis points rate cut from the Reserve Bank, a loosening in loan serviceability policy from APRA, and the removal of uncertainty around taxation reform post the federal election, are central to the current recovery. We’re seeing advertised stock levels persistently low, creating a sense of urgency in the market, increasing buyer demand. With the prospect of further interest rate cuts the outlook for 2020 for property is exciting!!!
If you are considering selling, reach out to us to see how you can get the best price for your property in the New Year.
John Wills FAPI
+61 467 443 838