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Demand for Victoria property skyrocketed in 2016

Demand for property in Victoria skyrocketed throughout 2016, with stock levels higher than they were one year previously. 

The latest Property Demand Index from the REA Group identified a 23.2 per cent surge in demand for the 12 months ending December 31st, the Herald Sun reports, with the figure outpacing the national average of 16.2 per cent. 

However, it was noted that there was a drop-off in December, which led to concerns being raised that the market's performance may be slower in 2017. 

Nerida Conisbee, chief economist of the REA Group, noted that some record prices were set in 2016, but that these "are likely to be more subdued as we move further into 2017".

According to the findings of the REA report, demand for Victorian houses grew 28 per cent for most of the year, before dropping 8.2 per cent in the final month. 

This trend was mirrored in unit demand, which increased by 16.1 per cent over the year and decreased seven per cent in December. 

Antony Buccello, senior buyers' advocate at National Property Buyers, was optimistic, stating that he believes demand will remain strong in 2017, although growth may slow. 

"It will be much of the same in the first quarter of next year, picking up where we left off from December," he remarked. 

"From late January, early February, everything will start happening again. There will be more competition out there, fighting for less property. I’m tipping demand will keep on outstripping supply."

Mr Bucello said that stock will start to improve around the second quarter of 2017, when people see demand is healthy - but this could still fall short of demand. He predicted 2017 will not be as big as 2016 in terms of growth, but will start off strongly before stabilising. 

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