FORGET about concerns of price growth slowing the property market, new research has revealed real estate is still a big earner.
The average home is now worth close to double what is owed on it, according to a new report by Aussie Home Loans and CoreLogic RP Data.
Home equity levels in Queensland rank fourth highest across Australia’s states and territories, with an average of 39.9 per cent in home equity, valued at $165,446.
Home owners in the far north Queensland regional council area of Cook had 47 per cent equity worth $201,144, followed by Noosa (46.5 per cent or $209,232) and Brisbane (45.3 per cent worth $227,539) and the Sunshine Coast (43.3 per cent), while Isaac (8.5 per cent), Gladstone (11.8 per cent) and Mackay (17.6 per cent) took the bottom three spots.
It found owners nationally had on average accumulated 48.4 per cent equity in their properties — an average of $242,000.
Not surprisingly with prices surging in New South Wales in recent years, those owners have more equity in their property than any other state.
The average NSW owner held about 56.6 per cent of equity in their home — equivalent to $358,763.
Even though Tasmanian owners had the lowest amount of equity in their homes, it still equated to more than a third of the value.
Aussie executive chairman John Symond, said the figures showed that property could be a great wealth creator for owners
“Especially when compared with the current correction being experienced in the share market,’’ he said.
“I believe the best investment both for security and lifestyle is still real estate and I see no reason why this will change over the next decade, especially in view of the lower interest rate climate, lack of housing supply in the major cities and continuing population growth.
“This (report) shows that over time property has proven time and time again that on the basis that you don’t try to pick a period of six months or a year or whatever that over the median to long term it is a safe bet.
Tim Lawless, research director of CoreLogic RP Data, said there was no surprise that south east Queensland ranks highly in home equity values as it is showing strong population growth, while the coastal area are proving to be attractive to both interstate and international investors.
“Queensland’s regional mining areas including the Bowen Basin coal mining area show substantially lower levels of home equity compared with areas closer to the coast.
“The continuing weakness in the coal price and slowdown in major infrastructure spending has been a strong influence on housing markets and the equity levels of homes in the area”, he said.
Original Publish: http://www.couriermail.com.au/