It hasn't been easy for owner-occupiers to purchase real estate in Surfers Paradise. While others might be in it for the profit, you may simply want a piece of Surfers Paradise property that you can call home.
Prices have been on the up, making it more and more difficult to enter the surging market. According to CoreLogic RP Data, the value of Australian residential real estate reached $6 trillion as of July 2015. Houses and units experienced a respective growth of 11.6 per cent and 7.2 per cent in the 12 months leading up to this period.
The Gold Coast itself saw home values rise by 5.7 percent in 12 months, outgrowing the rest of regional Queensland.
There are several reasons why the country's hotspot cities have been experiencing such powerful momentum in the property market.
One factor is the cash rate of 2 per cent that has been kept unchanged by the Reserve Bank of Australia (RBA) for the fifth month in a row. This has flattened interest rates to historical lows, driving up the demand for mortgages and in turn, housing.
Another reason is that the market has been white hot from investors competing over property. With the real estate doors swung further open by the aforementioned low interest rates, the Housing Industry Association (HIA) notes that investment lending reached an all-time high in July.
Glenn Stevens from the Reserve Bank commented that this cash rate was to stimulate growth in an underperforming economy. This has lead to resolute steadfastness of the rate despite increasing prices and fears of a housing bubble.
Instead, the Australian Prudential Regulation Authority (APRA) stepped in to counter this and try to prevent a market crash so often triggered by overinvestment in housing. The solution took the form of a 'speed limit' designed to keep investor credit growth down to 10 per cent per year.
Fortunately for owner-occupiers after real estate in Surfers Paradise, the intended result has been slowly taking form.
A lending commitment, as defined by the Australian Bureau of Statistics (ABS), is "a firm offer of housing finance. It either has been, or is normally expected to be, accepted."
As loans are the most common way to pay for a house, this acts as a good indicator of movement in the market. According to the ABS, the seasonally-adjusted dwelling commitment values of investment housing dropped by 0.4 per cent from July to August.
Conversely, owner-occupied dwelling commitment values rose by 6.1 per cent.
The HIA's Diwa Hopkins commented that "lending to investors seeking to construct housing fell away sharply during the month", following the news that owner-occupier loans rose by 2.5 per cent over this period.
While it could be too early to say for certain, these are solid signs that there's more and more space opening up for non-investors to buy Surfers Paradise property. Less competition with investors should lead to cooling prices.
Furthermore, first time homebuyer commitments increased by 0.3 per cent in the month to August to make 15.7 per cent of all owner-occupied housing in this period. People fresh to the market has evidently benefited from less investors occupying the market.
Are you looking for real estate in Surfers Paradise that you can really turn into a home? The searing housing market is beginning to cool down thanks to the APRA tightening their grip on investment lending. Give Ray White Surfers Paradise a buzz and we'll guide you through the entire process. You'll be enjoying the summer sun in your new home before you know it.