Buying
Australian Property Predictions 2017
02-Jan-2017
We know property prices in Sydney will continue to rise in 2017, that’s a given, but how much is always the question that everyone wants to know!
We came across this blog from property expert, Steve Jovcevski and found it a really interesting read. If his predictions are anything to go by, 2017 will be another cracking year for property sales.
Below is Steve’s property predictions for 2017 -
Sydney – 7-8% growth
Unsurprisingly, Sydney is set to power on throughout 2017. I think Sydney has a lot of growth left – we might see a drop in unit prices due to oversupply, but house prices will stay strong. The thing is there’s just too much demand in Sydney, and not enough houses up for sale to meet it. So during 2017, particularly the first half of the year, expect to see high demand and inner city prices to match. The outer suburbs will be strong as well, as buyer’s move further afield looking for available properties.
Melbourne – 9-10% growth
Melbourne saw an oversupply of apartments this year and that will likely continue into 2017. This year, the market in Melbourne grew quicker than Sydney and more than expected, but prices remained more affordable than in Sydney. I’m expecting much of the same for next year – the population is still increasing, which will balance out the amount of property available and mean strong growth for the market.
Brisbane – 6-7% growth
The Brisbane market performed pretty much as expected in 2016 and there’s plenty of room for growth next year. Like Melbourne, it’s suffered from an oversupply of apartments, which I think will get worse in Brisbane before it gets better. I’d expect the market for houses within about 10 kilometres of the city centre to be strong, but not as strong as it was this year.
Perth – 2-3% growth
Perth still has the highest vacancy rates around and low demand thanks to the fading mining boom means prices remain comparatively low. I think we’ll see the Perth market struggle in 2017. Having said that, I have a hunch the property market will bottom out toward the end of the year and then start to rise again as the effect of increasing commodity prices flows through to property prices. So I wouldn’t be surprised to see growth in late 2017 and then even stronger growth again in 2018.
RBA interest rates in 2017
As for what the Reserve Bank will be up to in 2017, I’m predicting another RBA rate cut before June and then possibly a second one later in the year. But lenders won’t be keen to pass on the savings – in fact, banks are already hiking rates for borrowers.
With the threat of a contraction in the economy this quarter, though, the Reserve Bank will be looking to counteract rising rates from lenders and head off any potential talk of recession. That means we’ll probably see a balancing act play out between the RBA and the banks in the coming year. Something interesting about that: this is actually the ideal situation for a rate-tracker mortgage. These loans have never been particularly popular in Australia, but with lenders set to raise rates and the RBA likely to lower them, having a mortgage that’s pinned to the official cash rate might not be a bad idea. So if there’s going to be a good time for rate-tracker mortgages, 2017 could well be it.
The Newton Team are looking forward to an awesome 2017 and are excited for the exciting year that lies ahead!
SOURCE – Mozo Blog
We came across this blog from property expert, Steve Jovcevski and found it a really interesting read. If his predictions are anything to go by, 2017 will be another cracking year for property sales.
Below is Steve’s property predictions for 2017 -
Sydney – 7-8% growth
Unsurprisingly, Sydney is set to power on throughout 2017. I think Sydney has a lot of growth left – we might see a drop in unit prices due to oversupply, but house prices will stay strong. The thing is there’s just too much demand in Sydney, and not enough houses up for sale to meet it. So during 2017, particularly the first half of the year, expect to see high demand and inner city prices to match. The outer suburbs will be strong as well, as buyer’s move further afield looking for available properties.
Melbourne – 9-10% growth
Melbourne saw an oversupply of apartments this year and that will likely continue into 2017. This year, the market in Melbourne grew quicker than Sydney and more than expected, but prices remained more affordable than in Sydney. I’m expecting much of the same for next year – the population is still increasing, which will balance out the amount of property available and mean strong growth for the market.
Brisbane – 6-7% growth
The Brisbane market performed pretty much as expected in 2016 and there’s plenty of room for growth next year. Like Melbourne, it’s suffered from an oversupply of apartments, which I think will get worse in Brisbane before it gets better. I’d expect the market for houses within about 10 kilometres of the city centre to be strong, but not as strong as it was this year.
Perth – 2-3% growth
Perth still has the highest vacancy rates around and low demand thanks to the fading mining boom means prices remain comparatively low. I think we’ll see the Perth market struggle in 2017. Having said that, I have a hunch the property market will bottom out toward the end of the year and then start to rise again as the effect of increasing commodity prices flows through to property prices. So I wouldn’t be surprised to see growth in late 2017 and then even stronger growth again in 2018.
RBA interest rates in 2017
As for what the Reserve Bank will be up to in 2017, I’m predicting another RBA rate cut before June and then possibly a second one later in the year. But lenders won’t be keen to pass on the savings – in fact, banks are already hiking rates for borrowers.
With the threat of a contraction in the economy this quarter, though, the Reserve Bank will be looking to counteract rising rates from lenders and head off any potential talk of recession. That means we’ll probably see a balancing act play out between the RBA and the banks in the coming year. Something interesting about that: this is actually the ideal situation for a rate-tracker mortgage. These loans have never been particularly popular in Australia, but with lenders set to raise rates and the RBA likely to lower them, having a mortgage that’s pinned to the official cash rate might not be a bad idea. So if there’s going to be a good time for rate-tracker mortgages, 2017 could well be it.
The Newton Team are looking forward to an awesome 2017 and are excited for the exciting year that lies ahead!
SOURCE – Mozo Blog