NSW activity property market to increase, says industry
25 Mar 2009 12:01 AM
SYDNEY, March 25 AAP - Activity in the NSW property market is expected increase over the first half of 2009 as buyers return tempted by lower interest rates and government grants, an industry body says.
The Real Estate Institute of NSW (REINSW) says the return of first home buyers has "re-energised" the state's property market.
REINSW president Steve Martin says early signs in 2009 of a strong return to the residential market by buyers is expected to continue.
Mr Martin said demand from first home buyers, which were typically at the lower-priced end of the property market, would flow through to other sectors, including investors.
"With interest rates continuing to fall, I see greater buying activity that will filter through from the lower-priced property to the mid-range over the next three to six months," Mr Martin said in a statement.
"What we are now seeing as a direct result of interest rates and the rental accommodation shortage is that investors are coming back into the market place."
The Reserve Bank of Australia (RBA) lowered official interest rates by 400 basis points between September last year and February, with most of the move passed on by mortgage lenders.
Those looking to purchase their first home have also benefited from the temporary boost to federal government grants announced in October last year.
The first home buyers grant was doubled to $14,000 for existing homes, while people buying a newly constructed home or building their home were eligible for $21,000.
The temporary boost was due to expire on June 30.
Mr Martin said the return of investors to the property market would provide more rental accommodation and create additional buyer demand.
"I anticipate that we will see even higher levels of buying activity in the second quarter of 2009 as more and more first home buyers take advantage of the increased benefits on offer," Mr Martin said.