To know what real estate prices will do over the next 5 years, you would need a crystal ball. However, looking at historical data of sales and median price comparisons throughout Australia’s capital cities, CoreLogic RP Data are able to reveal trends to help us forecast what lies ahead.
In a recent article by realestate.com.au where they spoke with Cameron Kusher, CoreLogic RP Data’s Senior Research Analyst, it was revealed that “the standout message” is that Sydney, and to a lesser degree Melbourne, has been the star performer over the past 5 years. “All other (capital cities) have been fairly muted”.
Kusher says that “one question people often ask is ‘why haven’t all markets grown equally when recent interest cuts are national?’ Well the reason we have seen such strong growth in Sydney and not in other markets is more because of overseas imigration to Sydney, which has been fairly strong because of its job opportunities, because New South Wale’s migration away has been low since 2010 and also because there’s a shortfall in housing. Australia’s property market is far from a one-size-fits-all”.
So what housing trends do the experts see in the next 5 years?
According to Cameron Kusher from Corelogic RP Data, “while interest rates stay historically low, Sydney and Melbourne’s house prices will continue to grow. It is hard to see that happening as strongly as it has this past five years, but as long as the fundamentals remain, there will be growth. As interest rates start to rise, we will see this growth tapering”.
Investor Nathan Birch, co-founder of Binvested, agrees there will be “a couple more years of solid growth” in Sydney. “Maybe not quite the double-digit growth we’ve seen in the previous few years, as there is still a shortage of supply and a strong confidence level based around the historically low interest rates”.
Information and quotes courtesy of Caroline James, journalist for realestate.com.au