The first home buyers waiting for a dip in property prices will be disappointed, experts warn

Buyers are waiting anxiously for Australia’s supercharged house prices to reduce will be disappointed, real estate experts have warned.

RiskWise Property Research CEO Don Peleg advises that although there are signs that exponential growth in property prices will slow down, it is highly unlikely that prices will be cheaper than they are at present.

“We do not expect Reserve Bank to raise cash rates in 2022, and there is fierce competition between banks and non-bank lenders, which maintains a certain level of downward pressure on mortgage rates,” Peleg said.

This four-bedroom house at 99 Ernest Street, Crows Nest, on the lower north coast of Sydney, was sold for $ 3,720,000 on Saturday. (Included)

“We expect housing prices to rise by between 5 percent and 8 percent in 2022 in the absence of significant macro-prudential restrictions.

“And in two years, we expect to see house prices higher than today.”

Australia’s home values ​​are currently rising at the fastest annual rate since June 1989 after rising by a whopping 17.6 per cent during the first nine months of 2021.

Auctions – especially for family-sized homes – are expected to be major issues throughout 2022. (Peter Rae)

Sir. Peleg said much of the interest will be on family-friendly homes in regional or lifestyle-oriented areas, as many are looking for a tree or sea change after two years of enduring the COVID-19 pandemic.

“Nationally, we expect a price increase in the 5 to 8 percent range by 2022. Homes and other family-owned properties – particularly in the more affordable areas of New South Wales, Victoria and south-east Queensland – are expected to be at the higher end of this range. however, the upper end of the market is likely to deliver slower capital growth, “Peleg said.

“Overall, house prices are likely to be higher than current prices in a few years. Potential buyers now waiting for price reductions are likely to be disappointed.”

Pete Wargent from the online platform BuyersBuyers said that forecasts of a rise in interest rates that paralyze house prices are largely over-inflated, such is the momentum in Australia’s real estate market.

“Election years come with their own uncertainties, but the talk of significant price declines due to a rapid rise in interest rates is exaggerated,” Wargent said.

“We expect 2022 to be a very busy year for transactions in the housing market, especially for investors. Buyers waiting for the promised price declines are, in our opinion, likely to be disappointed.”

Leon Handel and wife Cathy in front of their sold property in St Kilda. (Eddie Jim)

Last month, Westpac’s chief economist Bill Evans predicted that the real estate market would enter a “correction phase” in 2023, in line with the Reserve Bank of Australia’s indications of a rise in interest rates.

But do not expect to make a coup. Sir. Evans – like Wargent and Peleg – believes the market is still expected to post big booms throughout next year.

“As for 2022, the strong momentum will continue, but the rate of increase is expected to slow and level off over the next year before entering a correction phase in 2023,” Evans predicts.

“We expect price growth to slow to 8 percent in 2022, up from our previous forecast of 5 percent), with most of this increase loaded in the first half of the year.

“We hold on to our previous views that markets will move into the first year of a correction phase in 2023 as official interest rates rise and prices are expected to fall by 5 percent.”

Bondi Beach property sold for $ 1 million over reserve

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