Media release – date LISMORE PROPERTY MARKET SET TO IMPROVE IN 2012 Peter Brown from First National Real Estate Wal Murray & Co expects the current trend of a falling market in the Lismore region to continue into 2012, due to difficulties in securing finance, with the potential for the market to improve as the year progresses. Mr Brown said in the First National 2012 Property Market Outlook released this week, restoring market confidence is considered the key challenge for the Lismore property market to face in the first six months of 2012 with the biggest influences being interest rates and impacts of global economies. “People are reluctant to sell as they say they will wait for the market to improve along with prices to increase,” Mr Brown said. “Development in the region is being stymied by high costs and reluctance to develop at this stage of the market coupled with land scarcity and new home builders holding off until conditions improve.” According to the Outlook, a lack of buyers is placing downward pressure on residential property prices in the Lismore district which should see decreases of between 5 and 10 per cent across all sectors of houses, apartment/strata and land. The rental market should see vacancy rates ease, increasing by up to 5 per cent due to a lack of demand, which should see weekly rents decrease by between 5 and 10 per cent. Mr Brown said ongoing investor caution will keep investor activity low, with investors holding onto their cash until a more opportune time and that the strongest growth in activity for the Lismore region will come from retirees who are expected to represent a growth area for the property market as baby boomers from 1945 to 1950 are set to retire. Mr Brown expects interest rates to decrease by up to 1 per cent in the first half of 2012, which should restore some confidence to buyers and the market overall. Default mortgages may start to increase in the Lismore district with decreasing job numbers and under-performing local economy. The economic events in Europe and America are expected to impact on consumer confidence, always being negative on the economic front. The introduction of the carbon tax is expected to affect the property market, producing higher home prices which may help stimulate seller activity at the very least.
According to Mr Brown the main issue facing the rural property market in the Lismore region for 2012 is council regulations stifling land development which is making it harder and harder for developers to derive sufficient benefit. The commercial property market in Lismore in 2012 is expected to fall with prices having to come down as vacancy rates go up and sales decreasing as more business leave the region due to general economic conditions. Decreasing interest rates is always a positive influence, but given the current state of the market it is not expected their impact will be of any real significance to the commercial property market. The government’s carbon tax is also not expected to impact significantly as it is just hot air and something more practical needs to be done at the commercial property owner level. “Currently, around 1 to 5 per cent of our clients seek energy efficient features when looking to lease or purchase a commercial property, with solar power being the most popular ‘green’ feature that will make a property more rentable,” Mr Brown said. Mr Brown expects the medical sector to show growth in the commercial property market over the coming 12 month period. - copy ends Issued by: First National Real Estate For further information or to receive a copy of the 2012 Property Outlook, Peter Brown, Principal from First National Real Estate Wal Murray & Co, on 02 6621 2307