Australia’s $9.3 trillion housing question

When Sydney investors Kate and Andrew Dewez bought their first property in September last year, they hoped prices would rise in the next few years so they could build a portfolio on which to retire.

“We’re not too worried about further interest rate rises because we did our numbers based on the expected interest rate rises before purchasing the property, but hopefully, the market starts stabilising soon, so prices will increase again.” Shane Oliver, AMP Capital’s chief economist, says this could trigger another 9 per cent price fall by around September.“The main risks on the downside are that the RBA raises the cash rate to around 4 per cent as the money market is assuming, and the economy enters recession,” Oliver says.“The RBA has already raised rates by more than the 2.5 per cent interest rate serviceability buffer that applied up to October 2021.

”If the RBA were to hold [rates] below 4 per cent, given the surge in the economy that accelerated wage increases, I believe that will create grounds for a housing market recovery, albeit a soft one where we would see some single-digit house price rises occur in 2023, or at the very least, a situation where theBut the recovery could be delayed after house price falls reaccelerated in December.

“The last time Australia’s cash rate was over 3 per cent, national home values did experience a trough-to-peak upswing of around 16 per cent over 2009-10, but other factors such as strong overseas migration aided this, as did the dwelling market coming off a lower base, and being more affordable.” The more likely scenario is for prices to return to their long-term average annual growth of 4.8 per cent over the past decade and 5.1 per cent each year over the past 30 years.The federal government’s move to add supply of affordable housing could also dampen price increases in the years ahead, says independent economist Stephen Koukoulas.

Kent Lardner, founder of Suburbtrends, says a 10 per cent price gain could occur in select areas in 2023, but most markets are unlikely to enjoy any double-digit gains until late 2024.

Source: News Formal (newsformal.com)

hopefully, the cost of houses will fall.

I suppose we will see in 10 years

This labour government will destroy the midia class family and the whole Australia within it

I reckon you could have copied and pasted this from copies of the AFR from 1991, 2001, 2012, 2019. Looking at global capital cities we have a lot of room to move in most of our capitals. Regional is highly inflated. Not sure we’ll see doubles in short time frames there.

It’s not rocket science… HP = f (W, r)

Looking at fundamentals: - high migration - housing supply not keeping up with demand - high employment Basically this article is click bait. Once inflation stabilises let the fun continue!

It’s been over for a long time. Been in place for 20 years, no where near doubled.

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