So where do investors put their money when it seems the world has gone crazy? Westpac’s Chief Economist Bill Evans observes consumer sentiment seems to reflect the ‘safe as houses’ approach.
Here’s an excerpt from his guest column on Property Observer this month:
“This evidence of lower risk aversion is further highlighted by the lift in real estate as a favoured form of saving,” he said, referring to the results of Westpac’s latest consumer research.
“The proportion of those respondents favouring real estate increased from 24.6% in June to 28.2% in September. This represents the highest proportion of respondents favouring real estate since September 2003 – the last time we had an investor-led boom in real estate.”
Evans says expectations for house price growth are modest, but those surveyed still expect growth.
“The Westpac House Price Expectations Index fell from 132.7 in August to 127.3 in September (down by 6.1%),” he said.
“This Index is now down by 17% over the last year although remains well above 100 indicating that more respondents still expect prices to continue to rise.”
Read the full column on Property Observer.
