Research from ANZ reveals a potential 17% rise in house prices across the capital cities in 2021.
Property prices have soared in the first quarter of 2021 on the back of historic low interest rates that are expected to remain low for many years to come, as well as current government stimulus and improved affordability for both investors and home purchasers.
Looking ahead, it does not look like the market will slow down. It is expected to follow trend for the rest of 2021 and well into 2022.
The above forecast, by ANZ, reveals potential sharp rises across all the capital cities in 2021 alone, seeing Sydney and Perth housing prices jump 19%, followed by Hobart (18%), Melbourne and Brisbane (16%) and Adelaide (13%).
ANZ research and economists adjusted their previous forecast of a 9% national rise across the capital cities in 2021 to the strong potential rise of 17%.
The updated forecast is on the back of a thriving property market where Australian housing values surpassed previous records in January of this year alone.
Why The Market Didn't Have The Sharp Drops Predicted.
Many economists were predicting sharp drops in property prices from anywhere between 10-20% when the pandemic first hit just over 12 months ago. Fast forward to today, and we have seen the complete opposite in actual performance and the forecast continues to look bright.
The improved availability of credit for both investors and owners-occupiers has been fueling the property market and this can be seen on the weekend with continued strong auction clearance rates across all the capital cities.
Housing finance bottomed out at the start of 2020 due to the pandemic, but since then has continued to grow and the below data reveals that demand for housing continues to rise for both investors and especially owner-occupiers.
With record low interest rates expected to remain for the foreseeable future, strong demand for residential housing will continue to grow and property prices are expected to keep rising, but one should keep an eye on the amount of housing listings that enter the market and the overall balance of supply and demand.
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Jarryd Gauci – Property Investment Consultant
P: (02) 9939 3249
Disclaimer: When considering purchasing a property, it's always prudent to seek the advice of an appropriately qualified professional to determine which strategy is most appropriate for your individual circumstance.