Housing Recovery Expected to Drive 7% Increase in Home Prices

A quicker-than-expected housing recovery , triggered by the relatively low supply of listings and the resurgence of buyers, could propel home prices as much as 7 per cent higher nationally through the 2024 financial year , according to a panel of economists and analysts.in the six months to September, according to CoreLogic, a rebound that has defied the fastest rate-rising cycle in three decades, after demand initially cooled.

“We do not see this price growth as sustainable or backed by fundamentals, but equally don’t see what will halt the current housing recovery,” he said. Barrenjoey economist Jo Masters and AMP chief economist Shane Oliver expect home prices nationally to rise by 6.6 per cent and 7 per cent, respectively, through FY24.

But he warned that his confidence in his forecasts – he expects Sydney prices to gain 7 per cent and Melbourne 4 per cent – was “lower than normal”. “This is because of how we expect ‘supply shock – early stage’ and ‘interest rate relief – late stage’ to play out, he said. “We expect arrears will rise, but it will be only toward the end of FY24 that the impact of 400bp of rate hikes is reflected in +90 day arrears, which we expect to rise to slightly above the pre-pandemic average,” she said.Nevertheless, the respondents broadly expect the rate of arrears to increase only modestly through FY24 even though more borrowers are subjected to a jump in finance costs.

Source: Real Estate Daily Report (realestatedailyreport.net)

Housing Recovery Home Prices Economists Analysts Supply Buyer Demand Financial Year Corelogic Rebound Rate-Rising Cycle Survey Jarden Chief Economist Limited Listings Positive Sentiment RBA Easing Rate Cuts Reserve Bank Of Australia

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