Australian house prices will ramp up in 2019, according to ANZ economists

Discussion in 'Property Market Economics' started by Sackie, 24th May, 2018.

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  1. Sackie

    Sackie Well-Known Member

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    Five graphs that show what’s next for the property market

    Australian house prices will push modestly higher this year and ramp up in 2019, according to ANZ economists, who say outright price falls are off the table. National house prices are just 0.8 per cent higher than they were 12 months ago – a far cry from the 10 per cent growth seen in the previous year – but ANZ doesn’t expect the slowdown to deepen from here.

    Total growth of 1.8 per cent across the country is now forecast this year by ANZ, picking up to 3.6 per cent growth in 2019, with Melbourne and Hobart expected to outperform. While the days of double-digit percentage price growth are now history, outright house price falls aren’t likely, according to senior ANZ economists Daniel Gradwell and Joanne Masters. “We think most of the slowdown has already occurred,” the economists wrote this week. “We retain our view that prices will not materially decline. “We think most of the slowdown has already occurred.”ANZ senior economists Daniel Gradwell and Joanne Masters.

    Over the near term, auction results in Sydney and Melbourne suggest...

    (click link for full article & graphs)

    Five graphs that show what's next for the property market
     
  2. marmot

    marmot Well-Known Member

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    Does those figures also factor in the possibility of a change of government next year and no more negative gearing on established property.
     
  3. Kangabanga

    Kangabanga Well-Known Member

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    from link : [But Morgan Stanley analysts aren’t so confident, with risks seen to be building in 2018 after several months of house price weakness and possible further top-level regulatory pressure]

    IMHO I would be very surprised if we didn't see at least a 10% correction in prices by year end.
     
  4. Sackie

    Sackie Well-Known Member

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    I'd be surprised if certain, individual markets don't come off up to 10% next year but I don't see a 10% across the board in all markets and stock types. In certain markets I would love to see a 20% correction to further accumulate more stock. I love downturn markets just as much as boom markets. If you miss pre-boom buying then you have another chance to buy great bargains at the other end.

    I have always tried (and to a good extent, maybe 70-75% of the time been able to) buying in pre-boom markets which don't drop or drop very little in downturns, then buy in nicely corrected downturn markets. You get the double whammy of benefits in both scenarios which would be most optimal. Then with the strategy of adding value, any good buying becomes further amplified.
     
    Last edited: 25th May, 2018
  5. Lacrim

    Lacrim Well-Known Member

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  6. highlighter

    highlighter Well-Known Member

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    Like most property price projections they probably don't factor in much at all. They just pull a number out of their butts.
     
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  7. np999

    np999 Well-Known Member

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    My observations so far this year:
    1. Individual home owners in some suburbs have been very eager to sell, and dropped price to meet what buyers are willing to pay. Often (but not always) they are people who bought a new home and must sell the existing one.
    2. For owners who want to sell but don't have to, most have simply withdrawn their property from the market.
    3. Large reputable developers of apartments (Mirvac, Meriton etc) in high-demand areas are generally maintaining the current (very high) price level and their sales haven't slowed down.
    4. Smaller developers in some outer suburbs are having some trouble selling off-the-plan apartments but are not dropping their prices meaningfully either.
     
  8. hash_investor

    hash_investor Well-Known Member

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    I have seen outer Sydney prices dropping a bit. An apartment outwards west has dropped almost $25k by now and still no offers. And that is with the free stamp duty.
     
  9. sash

    sash Well-Known Member

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    Sydney will drop at least another 10%....
    Melbourne, Newcastle will drop slightly
    Brisbane, Hobart, Adelaide, and Canberra are now moving up
    Perth, darwin will be flat
    Regionals like Upper Hunter, Geelong, Ballarat...still going up...
     
  10. Kangabanga

    Kangabanga Well-Known Member

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    CoreLogic Home Value Index - Monthly Indices | CoreLogic

    Only Brisbane, Hobart, Adelaide green, everything else is red month on month.

    Perth and Darwin still going down. MoM and YoY
     
  11. hobartchic

    hobartchic Well-Known Member

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    Hobart is at below trend with 0.8 % MoM and 12 % yearly. To maintain trend it would need to be 1%. So I expect next month to be lower again given some of the insane price rise increases late 2017.
     
  12. highlighter

    highlighter Well-Known Member

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    I find this interesting as other banks have positioned themselves with the opposite view e.g. Westpac last week said it expects extended price falls. AMP, CBA, HSBC, UBS, Morgan Stanley and DB are also on the "falls" side to varying degrees. Westpac is now predicting 7.3% falls this year for Sydney. Of course, these are all just guesses or projections.
     
  13. PresentNow

    PresentNow Member

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    I can't remember which article it was, however, I remember reading where a publication company did a comparison between different stock brokerage/investment firms, the publication authors as well as "mum and dad" investor who did their own research and study. It was a comparison against 7 or 8 firms in total.

    The publication guys had the third or fourth best result with the throw the dart on the wall method. The mum and dad investors outperformed most of the professionals. Whilst a lot of the professionals did worse than chance.

    If anyone is interested try reading or listening to Tony Robbins Unshakeable. It was interesting that over 80% of Fund Managers did worse than chance and could not predict the timing of the market. That is they sell too soon and buy too late.
     
  14. sumterrence

    sumterrence Well-Known Member

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    My observation for Sydney is that anything above $1m is softening but anything between $600k to $800k is actually still going pretty hot. Obviously there are pockets within pockets but I'll list a few obvious ones.

    Below are some unexpected suburbs that I'm seeing a strong market:

    All the surrounding suburbs in Windsor, in particular South Windsor. Richmond is also getting very popular and prices are still on the rise.

    Hunter Coast and the surroundings including Maitland and Singleton.

    Suburbs that are showing obvious price softening:

    Kellyville, The Ponds, Baulkham Hills, Castle Hill

    Suburbs that prices are going back to 2014 to 2015 levels:

    Units in - Homebush West, North Parramatta, some of the units in Parramatta, Strathfield is also showing an obvious price correction again.
     
  15. L3ha7

    L3ha7 Well-Known Member

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    What about props under 600K in sydney west?-softening or still strong?
     
  16. hammer

    hammer Well-Known Member

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    Cant speak for perth but most of Darwin is at the bottom now. The stats will still reflect a price drop for a little longer as stubborn sellers (still!!) Drop prices to meet the market but I think the actual purchase price is about as low as it will go now.

    Things are actually starting to look up. The current government is being proactive and er... functional even. Mining investment is increasing, fracking is approved and direct Chinese flights have landed.

    Also the yields up here are still awesome. I think this will help the market as people change their strategy to cashflow.

    We're not out of the woods yet but things are starting to look much better.
     
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  17. sumterrence

    sumterrence Well-Known Member

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    Anything under $600k seems to be those undesirable ones where it is taking a while to move, it seems like most of them are ground floor units or houses in really bashed up state within a low social economy area.
     
  18. Rex

    Rex Well-Known Member

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  19. Silverson

    Silverson Well-Known Member

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    In my opinion we are just at the start of the down trend. I personally think we will see sideways movement until 2020-21 and that's without any policy surprises or rapidly rising interest rates. The shine has come off property at present. Unless the banks take the foot of the brake I can't see anything driving prices up anytime soon. (Melb/Syd)
     
  20. sash

    sash Well-Known Member

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    Clearly ANZ has no clue...they have just back flipped....houses prices are coming off in Sydney and Melbourne.

    In Brisbane...the lower end will move but the $1m probably not move as much due to lending restrictions. People who are developing properties for this end of the market will get burnt. Very similar to all the developers who built duplexes...they are having a hard time selling and rents are not flats some are looking down the barrel of bankruptcy.

    Canberra...Hobart are doing quite well and to some extend Adelaide is plodding along as it does.

    Fall in housing prices ‘larger than expected’
     
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