Last Updated: 17th August, 2017

Australian Housing Market Predictions

Published by Otto Dargan on January 20, 2012

According to the QBE LMI Australian Housing Outlook Report 2011-2014 released in October, Australia can look forward to a general improvement in the housing market. QBE is one of Australia’s leading LMI providers. This is an annual report that indicates what the top economists believe different housing markets in Australia will do.

In the past they have had an excellent track record of accurately predicting the future of Australian Real Estate.

They have no vested interest one way or the other. In other words this is an unbiased prediction!

QBE’s Predictions

The forecast by QBE for state capital cities over the next three years are as follows:

Sydney: Price growth of 19%-20% is forecast. The increase of housing prices is due to large demand and depletion of housing supply

Perth: 19-20% growth in the forecast period. In Perth the forecast reflects the stronger economic conditions driven by accelerated investment in the mining and resource sector

Melbourne: In the three years to June 2014, Melbourne is forecast to have the lowest price growth of 6% due to record levels of new dwelling supply eroding the current dwelling deficiency while more moderate house price

Adelaide, Hobart and Canberra: Increases between 6% and 8% are expected

Brisbane: Solid price growth of 16% expected

Darwin: 17% increase is forecast.

Ian Graham, CEO of QBE Lenders’ Mortgage Insurance Limited (QBE LMI), said “Despite the current volatility in the global economy, QBE LMI is cautiously optimistic about the outlook for the Australian housing market. The ongoing resource demand from Asia should continue to ensure growth in the resource and private sector, with conditions for a significant correction over the forecast period to 2014 just not there.”

Will falling interest rates effect house prices?

As interest rates are reducing in the end of 2011 and early 2012 it is likely that this will further increase house prices due to increasing demand from first home buyers and more favourable affordability. Property investors have been somewhat inactive during the GFC; as shown by the reduced demand for investment loans. It is predicted by several major banks that they will return to the market in 2012.

There are also talks of RBA cutting the interest rates further to create a favourable climate for home and investment property purchases in the first half of 2012. With Australian housing market predicted to boom and interest rates to go down it’s a good time to learn about how to get started. If you would like to discuss your specific situation and see how much you can qualify for visit our investment property forum. There are live brokers on our forum waiting to answer your questions.

The Home Loan Experts Property Investment Forum provides quick answers to your questions and a chance to gauge what similar minded property investors are considering for enhancing their property portfolio.

The complete QBE LMI Australian Housing Outlook Report 2011-2014 also offers good information on many factors to consider in each capital city when you’re looking to enter the property market.

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