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Australia - The Economic Crisis
Both Australia and Canada seem to have weathered the economic downturn quite well. The Australian government has stricter lending rules and as Australia has plenty of land available for new builds the country failed to experience the boom in 2004 - 2006.
However, financial specialists tend to agree that property prices may well fall between 5 and 10% next and year and an increase in property prices will not be seen until at least 2011.
Inevitably, the Australian property market will be affected by four main factors. Employment, debt, global economy and house price stability. Debt is at an all time high and as the property market increases numbers of buyers will drop as they simply cannot afford to get into anymore debt.
Throughout Australia, unemployment rates are rising. Due to the global economy many businesses are playing safe and many full time employees have been changed to part time thus saving the company on wages, tax and health care expenses. Redundancies will also increase if the economy does not pick up.
The Australian property market, throughout 2009, managed to maintain solid ground. If interest rates and repossessions are kept to a minimum then modest increases in property prices should be seen in a couple of years.
The Australian banks seem to be working with their customers to help bring back the economy and are allowing customers to keep hold of their homes. If banks hold large amounts of overvalued repossessions then the market will surely suffer.
In all, Australia seems to have ridden the storm rather well. Both commercial and residential properties are still being bought by overseas buyers with the added bonus of additional taxes and fees being fairly low in the country for property owners.
Investment from foreign parties is important to any countries economy. Due to this, Australia has made purchasing property fairly simple. Even though agreement from the Australian Government has to be sought prior to purchasing after this the process is fairly straightforward.
Australia is still a prime country to invest in, whether in residential or commercial properties and the country will no doubt ride the economic storm for the next few years.
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