Shares or Property in 2019?
Shares or Property in 2019?

Brisbane property is still among the top investment choices of 2019 as economist weigh in on the shares vs property debate of 2019!

Investors looking for the best place to park their cash this year face challenging market conditions for both residential property and shares, economists say.

Housing has been hit by the financial services royal commission and a tightening of credit, while federal Labor’s proposed changes to negative gearing and capital gains tax incentives have also added uncertainty. But sharemarkets locally and overseas have recorded large swings in recent weeks as investors fret about the China-US trade war and its potential local impacts.

HSBC Australia’s chief economist Paul Bloxham said the housing market was going through an orderly decline and there has be very little sign of distressed sales and loan arrears. Alongside this, the macro-economy and labour market has been doing well, so if any time to decline, now is optimal.

AMP Capital chief economist Shane Oliver said while property price falls had been most significant in Sydney and Melbourne and could continue, those still keen on investing in property could look outside these major cities. Drum roll Brisbane!

Mr Bloxham said the housing market should start to recover toward the end of the end of the year, which is good news for property-oriented investors. But Mr Oliver said share prices could bounce back sooner.

CommSec’s chief economist Craig James agreed that the large sharemarket downturn over the past 12 months meant there was more potential for upside than in housing this year.

But the significant global issues facing share markets such as the trade war between China and the US could affect the Australian market, said Alex Joiner, chief economist at industry super-backed IFM Investors.

“Australian shares have been heavily impacted by what’s happening overseas and what we’re seeing overseas is a pretty big turnaround on risk sentiment,” Mr Joiner said. “Global investors got a lot more pessimistic on the outlook for the global economy. The prospects for global growth are not going to get any better from here.

Mr Joiner is mindful of the risks in both shares and property. “You’ve got the be equally cautious of both those markets going into 2019,” he said.

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Shares or Property in 2019?