Whilst regular readers of these posts will know that we are reluctant to put too much credibility on individual forecasts on future property prices, it’s been interesting to see how many commentators have become more upbeat about the overall market in recent months.
A prime example of the growing confidence in the market was the decision by NAB to revise their near-term forecasts for capitol city housing prices across Australia, lifting their prediction for prices in 2023 to rise by 8 per cent. This is a substantial increase on their previous forecast of a rise of 4.7 per cent this year. They have also tipped a further rise of 5 per cent in 2024, making their expectation a combined growth of 13 per cent over the two year period.
This forecast is particularly bullish as it was made despite the growing expectation of another interest rate rise on Melbourne Cup Day.
In releasing their updated forecast, the Chief Economist at NAB, Alan Oster, noted the impact of the ongoing shortage of available property listings, noting that property prices “continue to be supported by a significant supply-demand imbalance”, despite rising rates and reduced borrowing power.
He also provided an updated outlook on interest rates, saying “On rates, we continue to see the RBA lifting the cash rate to 4.35% at the November meeting before remaining on hold until the second half of 2024. From there, we think the RBA can begin to ease policy back towards neutral of around 3%.”
Of course, anyone wanting to make their next move in the property market before prices rise further will need to keep in mind that time is becoming the most critical factor now there is only a month left in Spring. So feel free to give us a call at Ian Reid Buyer and Vendor Advocates this week on 9430 0000 if you need experienced and objective advice.