Spring may see investors warm to real estate

Hopefully warmer weather will combine with other favourable conditions to fuel the appetites of potential property investors, according to Australia's largest independently owned mortgage broker.

The latest Australian Bureau of Statistics housing finance report saw the value of investment housing loans drop for the first time in four months in June 2010 by a seasonally-adjusted 3.6 per cent to $7.3 billion, the lowest value reached since February this year.

However, this compared favourably to $6.5 billion in June last year.

Many market commentators say this buyer group had been holding back until the election was over and the traditionally strong spring selling season begins. They won't have to wait much longer.

Mortgage Choice senior corporate affairs manager, Kristy Sheppard says that according to RP Data, Australia typically sees higher than average property activity from September through to November.

"This year should be no exception, despite a possible lag effect from the hung parliament," she said.

"There are already more properties on the market than usual at this time of year.

"That is good news for prospective investors, as is property prices plateauing in many areas and dropping in some; rental prices increasing; strong population growth continuing; consumer sentiment rising and the share market continuing to be unpredictable.

"Housing undersupply is a serious issue in Australia and ABS building approval figures show a fall for a third consecutive month in June to reach the lowest level since August last year.

"Hence, many investors believe the long-term potential of property as a stable asset class is excellent.

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