Will the royal commission push down property prices?
There is varied opinions amongst the professionals
This situation will result in lower demand from those looking to own a home, in favour of higher demand for rental housing. But the effect of higher interest rates may not be strong enough to decrease demand for property by real estate investors and businesses. Real drivers of property prices are land availability, construction costs, population growth, and to a lesser extent finance access and cost.
The effect of these changes will be that banks reject more consumers who apply for loans and offer less of them going forward. Home buyers will then have less ammunition available in bidding for real estate which will eventually dampen house prices. It will be interesting to see whether these changes will make houses more affordable. But much will depend on whether or not people get a wage rise.
Zain’s thoughts –
The royal commission will slow down the market but it we will not see property prices dripping due to the commission.
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