Australian homes are not overvalued by 40 per cent and instead represent good value based on current market conditions, Ray White Group joint chairman Brian White said.
“There is no doubt that many [believe] that current conditions reflect smart buying opportunities,” he said.
Mr White made the comments in his July White Paper, released this week, in response to an article published in Business Review Weekly (BRW) that said houses in Australia were severely overpriced.
The BRW claim could not be substantiated, he said. While Mr White acknowledged a decline in overall property prices, an increase in sales had helped keep the real estate sector active since January this year.
“The recent decision by the Reserve Bank of Australia (RBA) to hold interest rates at current levels…may well suggest that we may be in the ‘bottoming’ part of the cycle,” he added.
“Relatively few of our offices report that they have an oversupply of stock for sale. Building activity is at a low level. So a dramatic oversupply is not looming as a fundamental problem.”
He said the historically high Australian dollar was doing nothing to quell investor interest from Asia, although enquiries from the United States had dropped 20 per cent from earlier this year.
Mortgage volumes at Ray White’s mortgage broker arm Loan Market were also 10 per cent above last year’s levels, he added.