The 5 key investing trends to expect this spring

27 AUG 2018 By Sasha Karen 9 min read Hotspots

With spring just around the corner and the weather set to warm up soon, investors will be looking to emerge from their cozy homes from the winter and get back into buying property. Here are what you can expect from the world of investing for the next three months.

spring bloom property spi

With the sun expected to come out, investors are free to leave the comfort of their homes to check out new properties in the warm spring air.

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According to ME’s head of home loans Andrew Bartolo, there are five key trends investors need to keep in mind if they plan to buy property this spring.

1. The cooling property market

So far this year, Mr Bartolo said the market is currently a buyer’s market, as the cooling of the market is dampening prices and volumes in some areas, but there is more activity predicted for the warmer weather.

“Spring is typically the time the market blooms with listings so we expect to see an uplift in lending activity,” Mr Bartolo said.

Despite the typical usual seasonal activity, Mr Bartolo recommended investors should observe how the market plays out before making any quick decisions, which could possibly put things even more in a buyer’s favour.

“Sellers will therefore need to keep reserves realistic and prepare for their property to pass-in at auction,” Mr Bartolo said.

2. Lessening investor interest

Taking the cooling market into consideration, as well as APRA’s lending restrictions, Mr Bartolo expects many investors to be sitting and waiting. This could give any investors looking to buy the opportunity of having less competition.

3. Credit access expected to stay tight

Even though the 10 per cent investor growth cap has been removed by APRA, Mr Bartolo still sees lending this spring to continue being subdued.

“The 30 per cent cap remains in place for interest-only loans, a product typically used by investors. Banks have also been tightening serviceability requirements, which has constrained overall volumes of lending by borrowers,” he said

4. More first home buyers predicted

Even though less investors are expected this spring, Mr Bartolo said there will likely be more first home buyers in the property market, as the current cooling conditions provide affordable entry points for them to buy their first home.

“First home buyers will benefit from competitive interest rates, concessions (if eligible) and ample apartment stock, although checks should always be made to ensure quality buys,” Mr Bartolo said.

5. More refinancing

“We expect customers to shop around for better home loan deals,” Mr Bartolo added.

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