As we reach mid-year, the two great unknowns facing residential markets in 2019 - the final report of the Banking Royal Commission and the federal election - are behind us. The outcomes of both should provide a level of comfort to residential markets.
Signs are now emerging that a controlled relaxation of credit constraints is being managed. Expected interest rate cuts should provide a further boost. The Coalition’s election victory means proposed taxation changes impacting investment property are off the agenda, while first home buyers have received a modest additional assistance package.
These elements have evolved rapidly in recent weeks. We expect that in combination they will increase the number of buyers looking to enter residential markets, providing stronger support for prices and bringing forward the cyclical bottom into H219 whereas previously it was looking like price falls could continue into 2020.