The next three years could prove an interesting time for the Belconnen property market, as one study suggests that the country may soon face an oversupply of real estate. BIS Shrapnel's Building in Australia 2015-2030 report highlighted that while many key markets currently don't have enough supply, this might not be the case for much longer.
The group predicts that dwelling starts reached around 210,000 in 2014-15, an all-time high for the industry. However, activity is soon expected to start falling, especially in the high-density sector.
Associate director with BIS Shrapnel Kim Hawtrey explained: "Low interest rates have unlocked significant pent up demand and underpinned the current boom in activity, but as population growth slows while construction activity remains strong, new supply will begin to outpace demand."
She argued that the supply of properties is now exceeding demand, especially as upgraders and downsizers are particularly active. There's also the added factor of increased net overseas migration, which has brought more people into the Australian real estate market.
The Housing Industry Association (HIA) seems to support this view, as it acknowledged that building activity had already been trending higher at the start of the year. After analysing figures from the Australian Bureau of Statistics, the group explained that house building reached the second-highest level on record during the March quarter.
In the 12 months leading up to March, 205,000 dwellings were given the go ahead, making it the first time the 200,000 mark had been exceeded. The HIA already predicts that results may have been even higher during the June quarter, adding to the likelihood of the market soon reaching oversupply.
Are you hoping to move to the ACT in the near future? Make sure you speak to the team at Ray White Belconnen for insight into the local market.