The bounceback in Sydney housing prices continues to surprise keeping forecasters on the hop as they try to second guess where the market will go next. One new report is optimistic at best, and jaw-dropping at worst.
ANZ Forecasts Faster-Than-Expected Property Market Recovery
ANZ, one of Australia’s leading banks, has recently revised its predictions for the property market, suggesting that a faster-than-expected recovery is on the horizon. Initially, ANZ had anticipated an 11% decline in house prices for this year; however, their senior economists now believe that price rises will commence earlier than anticipated.
Sydney is expected to experience a 2% increase in house prices, while Perth is predicted to see a rise of 1%. On the other hand, Melbourne is expected to remain stagnant, and cities like Brisbane, Adelaide, Hobart, Darwin, and Canberra are likely to witness price declines.
Looking ahead to 2024, ANZ forecasts house price rises across Australia, with gains of 2% in Sydney, Melbourne, Canberra, and Hobart, and even more substantial increases in Brisbane, Perth, and Darwin. Overall, ANZ predicts a 3% increase in house prices by 2024, with the exception of Adelaide, which may experience a 1% drop.
Factors such as limited availability of new homes, increased migration, and a tight rental market are driving this property market recovery.
Key Takeaways
- ANZ predicts property market to bounce back quicker than expected
- ANZ previously predicted 11% slump in house prices this year
- ANZ senior economists back price rises starting earlier
- House prices set to increase by 3% in 2024 across Australia
ANZ’s Property Market Predictions
ANZ’s property market predictions indicate a more positive outlook, with expectations of a quicker recovery than previously anticipated, as they predict rises in house prices for Sydney, Melbourne, Canberra, and Hobart in 2024.
ANZ had initially forecasted an 11% slump in house prices this year but has now reversed its predictions. They predict a 2% increase in Sydney house prices and a 1% lift in Perth house prices. However, Melbourne is expected to end the year flat, and declines in house prices are anticipated in Brisbane, Adelaide, Hobart, Darwin, and Canberra.
ANZ’s senior economists now believe that price rises will start earlier than expected, with even better increases in Brisbane, Perth, and Darwin. Overall, ANZ forecasts a 3% increase in house prices across Australia in 2024, with Adelaide being the only exception with an expected 1% drop.
Factors Affecting the Property Market
Factors affecting the property market include an aggressive round of interest rate hikes in Australia, a rental crisis, unexpected factors that have taken economists by surprise, a low number of new homes for sale, and a surge in migration.
The aggressive round of interest rate hikes has the potential to increase borrowing costs for home buyers, which could dampen demand and slow down the property market.
Additionally, Australia is currently facing a rental crisis, with a tight rental market pushing some individuals into the home buyer market.
This increased demand from return of migrants and the surge in migration overall have contributed to the tightening of supply and the low number of new homes for sale.
These factors, along with the unexpected elements that have surprised economists, have combined to shape the current state of the property market.
Related Topics
Other related topics in the property market include the actions of the Reserve Bank, bidding intensity at Sydney’s auctions, the demand for affordable homes, the sale of a southern Sydney home by an iconic cab company, and the availability of lower mortgage rates offered by banks on new loans.
The Reserve Bank plays a crucial role in influencing interest rates, which in turn affects the affordability of housing loans.
Bidding intensity at Sydney’s auctions reflects the level of demand and competition in the housing market, providing insights into buyer sentiment and market trends.
The demand for affordable homes is an ongoing concern, as housing affordability continues to be a challenge for many Australians.
The sale of a southern Sydney home by an iconic cab company highlights the diverse range of sellers and buyers in the property market.
Lastly, the availability of lower mortgage rates offered by banks on new loans can impact housing affordability and stimulate demand in the market.
Conclusion
In conclusion, ANZ predicts a faster-than-expected recovery in the Australian property market. They anticipate price rises in Sydney and Perth this year, while Melbourne is expected to remain flat and other cities may experience price falls.
Looking ahead to 2024, ANZ forecasts house price increases in most cities, with overall growth of 3%, except for Adelaide which is expected to see a slight decrease.
Factors such as low housing supply, increased migration, and a tight rental market are driving the property market recovery.
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