With the announcement that the federal election will be held on 21 May 2022, Australians casting their vote have the power to retain our current Prime Minister and Liberal Party leader, Scott Morrison, or welcome Labor leader Anthony Albanese into our top Federal Government role.
Exactly what it will mean for existing property owners and potential property buyers is yet to be determined.
The impact of the upcoming election
When such a major vote is looming, the natural sense of uncertainty typically sees people put major spending decisions temporarily on hold.
Recent figures from the Australian Bureau of Statistics (ABS) support this and reveal that the number of new owner-occupier loans approved to first home buyers fell by 32.6 per cent in the 12 months to January 2022.
The ‘wait and see’ trend is an expected outcome in the lead-up to a federal election. As housing features as an important policy initiative for both major political parties, the property market will be interesting to watch in the next few weeks. While some will decide to wait, others will take advantage of the decreased competition, in the hopes of securing their ideal property at a price they like.
Is it a good time to buy?
Any significant financial decision should always be made with careful consideration and upon advice from relevant professionals.
The release of the Foreign Investment Review Board (FIRB) 2020-21 Annual Report shows that the number and value of purchases of Australian residential property by foreign buyers fell to its lowest level in around 15-years – a direct result of Australia’s international border closure to immigration. While property prices have still risen in many areas across Australia during the pandemic, some property specialists believe that the lack of foreign buyers may, ultimately, see property prices decrease.
Rising interest rates may lead to falling house prices
With the big four banks predicting that interest rates are set to rise from June 7 – no matter who is elected – some property experts believe that may also motivate a slight price drop in the property market. It’s important to remember, of course, that any potential savings in falling property prices should be measured against the cost of higher mortgage repayments.
In the lead-up to election day, housing affordability is set to be an important part of both major political parties’ respective election campaigns, with potential buyers curious about promises of a variety of incentive schemes that aim to deliver easier access to home loans.
Precisely what will happen for home buyers will be clearer after May 21 – a powerful incentive to explore the pledges that are being made to make your vote count.
This article is provided for general information purposes only. Its content is current at the date of publication. It is not legal advice and is not tailored to meet your individual needs. You should obtain specialist advice based on your specific circumstances before taking any action concerning the matters discussed in this article.