QBE has released its latest survey findings on the state of property and mortgages in Australia which highlights the view that property was increasingly becoming substantially overvalued.
Since the February 2015 interest rate cut, the appeal of residential property has increased, the QBE Barometer 2015 found.
More than half (56%) of respondents think property prices will continue to rise in the next 12 months and only 23% think prices will fall.
Housing unaffordability remains an increasing concern for those intending to purchase real estate in the next five years.
“Intenders believe housing prices are at least somewhat overvalued (59%) and that affordability will worsen (47%).
However intenders also perceive it is more important to get into the property market now (53%) than to wait to save a bigger deposit (20%), suggesting property purchases may be being brought forward in the belief housing will become more expensive.
A very high percent of respondents have an increasing concern that foreign investment is boosting property prices.
Intending property purchasers are troubled about foreign investment in residential property, with two thirds (69%) concerned it will make property unaffordable (vs. 64% in June 2014 and 58% in May 2013).
Those in Sydney are the most concerned (76%).