Anxious Sydney property sellers have been buoyed by the quick spike in market sentiment since the election.
There’s been a trifecta of good news, starting with the end of concerns over Labor’s negative gearing policy.
The Reserve Bank board has since signalled it could soon be cutting interest rates, possibly in early June.
And then the financial regulator, the Australian Prudential Regulation Authority (APRA), signalled its lending restrictions could be relaxed.
APRA have moved to allow banks to lend more, which could ease the credit squeeze from July.
APRA’s scrapping of the 7 per cent stress test buffer on home loan borrowers will effectively see a 9 per cent increase in borrowing capacity for owner-occupiers.
That could rise to 14 per cent if the RBA cuts twice, according to RiskWise Property Research CEO Doron Peleg.
The housing policy announced by the returning Morrison government will give a deposit boost to 10,000 first home buyers from next January, plus there’s the income tax refund due from the April federal Budget.
All will boost market confidence and possibly activity.
Estate agents certainly have a fresh spring in their step, although they will soon hit the seasonal hibernation when many vendors decide to hold off listing through winter.
While the past few weeks have seen the emergence of the seeds for recovery, it will however be months before the markets will actually see if there’s a sustained outcome that prompts a price revival.
Don’t forget there’s four months of housing stock available for sale in Sydney, the highest at this time of year for seven years. Just 200 vendors chanced going under the hammer across Sydney on election Saturday. This Saturday there’s 550 scheduled.