I don't think underlying fundamentals have changed, so no.
Maybe a temporary hiatus and a small buying window with the recent negative sentiment.
Hi JIT,
Depending on what fundamentals you are referring to (I assume you are referring to factors they may influence supply and demand on housing?).
It's difficult to draw meaningful conclusion out of one REIV comment. Auction clearance results have been consistently over 80% in the past year. However, I do see some "fundamentals" changing.
-FIRB policy reversed (amount of foreign investors demand reduced)
-Immigration policy reduced (demand reduced )
-Availability of credit reduced and credit policy tightened (demand reduced)
-FHB incentive reduced (demand reduced)
-Interest rate higher (demand reduced)
-Other cost of living increased and hence disposable income reduced (demand reduced)
-Incentive and policy to encourage affordable housing (incease supply)
-low affordability comparied to disposable income (demand reduced)
-low yield due to recent high growth (demand reduced)
That is not to say I expect prices to drop. I suspect demand will ease off in the near future, and we may experience a more modest (low to moderate) growth in Melbourne in the coming months. The market will become more segmented with tiered growth (in terms of price range) due to the withdrawal from the FHB segment (either priced out, risk aversion or brought forward decision to buy last year)
With the recent news reports of record number of new unit building approvals (source:
http://www.news.com.au/money/proper...s-hit-fresh-high/story-e6frfmd0-1225862524761), if they eventuate, will likely to lead to an income effect in the short term (i.e. with property related industries like builders, plumbers, REA, etc - having more disposable income to spend and invest). This will probably mean the property market can sustain for a short period of time (9 months - 2 years). Whether or not we will see a correction after that will depend on if the developers overshoots the level of demand. This is just a personal opinion.
Any thoughts?
Cheers,
Kenny
PS. I'm a long term property investor with several IPs in VIC and QLD. I am not very skilled at trading properties based on speculation.