This article is from the Australian Property Journal archive
SYDNEY, Perth and Brisbane have the best prospects for price growth, according to Australian Property Monitors’ State of the Market Report.
APM senior economist Dr Andrew Wilson said the national median house price growth of 5.0% over 2013 will be the best annual result since 2009, when prices increased by 12.6%.
“The national housing market continued to recover during 2013 as the impact of the lowest interest rates in 60 years, improved affordability and rising confidence activated home buyers at varying levels in most capital city markets.
“Sydney was the standout performer with median house price growth expected at 11% for 2013, followed by Perth and Hobart each with 8.0%, Melbourne and Darwin both 7.0%, Brisbane 3.0% and Adelaide 2.0%. Canberra median house prices however are set to fall by -2.0% over 2013.
“Only Sydney, Perth and Darwin will have recovered to previous peak-levels, and all other capitals will remain below their previous house price peaks recorded in 2010 with Brisbane clearly the outlier still 5% behind,” he said.
Dr Wilson said the outlook for capital city housing markets in 2014 remains mixed with the impact of declining economic activity to act to generally moderate house price growth.
“Mixed-speed local economic conditions will however prevail with underperformances from Sydney, Melbourne, Adelaide and Canberra offset by continued strength in Perth and a solid re-emergence of the Queensland economy impacting on Brisbane and regional markets.
“Rising unemployment will likely activate the Reserve Bank to again cut interest rates notwithstanding a downward trajectory for the local currency dependent as usual on the international economy particularly the performance of the US,” he added.
House prices in Sydney, Perth, Brisbane and Darwin are expected to grow by 5 – 7% over 2014. However the performance of other capital cities will be mixed.
Nationally house prices are expected to rise between 3 – 5% over 2014, which is the same level forecast for Melbourne and Hobart. Adelaide and Canberra are expected to lag behind with 0 – 3% growth.
“Although lower interest rates will be a bonus to mortgage holders the impact on housing markets will be muted by concerns over job security and continued low income and profit growth. The prospect of a continued modest performance by the stockmarket will also act to subdue prestige property buyers – particularly in Sydney.
“Within a fluid and uncertain economic outlook, it is expected the national median house price will likely increase by between 3 – 5% in 2014 bolstered by solid early-year contributions from Sydney, Perth, Darwin, Brisbane and Hobart with more modest inputs from Melbourne, Adelaide and Canberra,” he forecast.
Property Review
