Victorian Housing Plan: Opportunities and Challenges for Borrowers

Of major interest among potential homebuyers and borrowers, the Victorian government’s ambitious plan to deliver 2.24 million?homes by 2051 caught the most attention. In response to the?growing housing crisis threatening the ability of young people and workers to attain homeownership, this proposed measure would place caps on housing price increases in Western Australia (WA).

But what does this plan mean for borrowers, property?prices and buyer opportunities?

Effect on the Availability?of Home Loans

Positive implications for?home loan availability as government plans to increase housing supply. As the?new homes are built, most of which have been based in regional centres like Greater Geelong, Ballarat and Bendigo, there will be an increasing need for finance. The?increased demand may result in more aggressive competition for lending between banks or other financial institutions interested in capturing the growing market. Nor do they expect much, if any, help?for borrowers looking to refinance their home loans.

Effect on Property Prices

Historically, this expansion of the housing stock?has generally been inflationary for the property market. In targeting the construction of 2.24 million homes by 2051, the Victorian government is responding to the supply-demand imbalance that has pushed prices?higher over the past few decades. But this isn’t going?to cause a drop in property values, it would potentially help keep prices stable, making homeownership more affordable for first-time buyers and those wishing to climb the property ladder.

Opportunities for Buyers

The housing plan offers several?possible advantages to buyers. Although more homes are being built, the growth rate is slowing, and the range of property types available is expanding, i.e. new?builds, affordable housing, etc. This increased selection could provide clients more leverage during negotiations,?possibly resulting in better offers. Furthermore, areas?focusing on regional areas could improve these areas’ attractiveness for buyers searching for a quieter lifestyle or more space for their money.

Challenges and Considerations

On the flip side of the positive bright side, there?are some challenges to note. The National Housing Accord has already struggled to achieve its targets?in terms of the number of homes to be built. This begs the question of whether the Victorian government’s ambitious?targets are achievable. Moreover, more construction could result in higher building costs, which could be passed?on to buyers as higher property prices.

Victoria’s new?housing plan gives buyers and borrowers reason to hope. The government is putting forward an ambitious plan to meet the?housing crisis, with a target of 2.24 million homes by 2051. As a result of this, there will be more?home loans available, property prices will level out, and there will be more chances for buyers. But the success of this plan relies on?addressing existing challenges and vowing to meet construction targets. Borrowers must remain vigilant and consult with qualified financial advisers to manoeuvre the?changing property landscape.

Want to find?out how the Victorian government housing plan could be your silver lining? With ASK Financials, Our experts?will take you through the borrowing process and highlight the financial options available to you tailored to your needs. Call 0433 944 055 Book your appointment now to get your dream of homeownership realized!