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5 factors that will impact Australian property in 2018

Rising mortgage rates and cooling property prices are expected to be among the biggest trends impacting the Australian housing market in 2018, according to industry experts.

Online property publication Domain has compiled a list of what it believes will be the five most important property market trends of the next 12 months, with steadily increasing mortgage rates anticipated to create a profound impact on the market down under.

Experts are expecting the Reserve Bank of Australia to announce a rate rise within the coming months, but are warning consumers that if this doesn't come, they should be prepared for costlier mortgage repayments in the future.

Next on the list were predictions that property prices will continue to slow down, particularly in Australia's bigger cities, where they have already begun to cool. However, it is expected that values will decrease steadily for the time being; property prices have been booming for a few years now, so this slowdown isn't really a surprise.

It is also believed that there will be more opportunities and options open to first-time buyers in Australia over the next year.

Patrick Nolan, head of loans at ME Bank, explained: "With investors taking a step back, first-home buyers will find more opportunities in 2018.

"They will continue to benefit from competitive interest rates, new concessions (if eligible) and ample apartment stock, although checks should always be made to ensure quality buys."

Following on from this, investors and so-called upgraders are expected to be more likely to remain in their current homes over the next year, putting more of their money into renovating their existing properties than buying new ones, in light of the fact that no one knows for sure just how dramatic the cooldown in property prices will be.

Lastly, the fifth top trend cited in Domain's list was that owner-occupiers will gain more prominence in the Australian property market, partly due to banks offering competitive deals for these buyers. In many cases, this is a reaction to the limits that currently stand in the way of investor- and interest-only growth, Mr Nolan explained.

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