Confidence among Australian homebuyers bounced back in the third quarter of the year as the Reserve Bank of Australia slows down on rate hikes.
According to the latest NAB Behavioural Insights for Housing, the share of Australians who believe now is a good time to buy a home reverted to 23%, after dipping to a record low of 18% in the previous quarter.
NAB group executive for personal banking Rachel Slade said the spring-selling season seemed to have brought confidence back to the housing market.
“The first rate rises in more than a decade have caused concern but signs the pace of rate rises are easing has generated a rebound in confidence through the crucial spring selling season,” she said.
The tight conditions in the rental market are also a factor, encouraging investors back into the market and tenants to consider buying a home to escape rising rents.
“While we expect prices have further to fall, there are reasons for more optimism than a couple of months ago,” Ms Slade said.
Confidence in buying a home has lifted across most states – highest in Victoria (27%), followed by Western Australia and New South Wales (25%).
The ACT bucked the trend, having recorded the strongest level of buyer confidence in Q2 (27%), easing back to around 20% in Q3 (20%).
South Australia came in next (19%), followed by Queensland (19%) with confidence to buy weakest in Tasmania (18%).
Meanwhile, the share of Australians who think now is a good time to buy an investment property remained steady at 21%.
The gains were sharpest in New South Wales (24%), followed by Western Australia, (21%), Victoria (20%), and Queensland and South Australia (18%).
On the other hand, sentiment fell sharply in the ACT and TAS to just 10%.
In terms of renovation plans, slightly fewer Australians over the quarter think now is the best time — down from 11% to 10%.
“Most Australians aren’t confident they will be able to renovate in a timely, cost-efficient way, although there is hope price hikes will start to moderate into 2023,” Ms Slade said.
Over the quarter, close to a third of Australians believe conditions are ripe for selling their home or their investment property.
“Unsurprisingly, it is typically houses that need a bit of love that are struggling to find buyers at the moment, while houses that are move-in ready are often finding strong demand, particularly given the relative lack of supply,” Ms Slade said.
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