Corelogic Property Price 'SuperSurge'

Last week saw property prices SuperSurge the fastest on record:



CoreLogic weekly house price update: Super Surge - MacroBusiness

 

November saw "the largest monthly increase in Sydney house values since 1988" according to SMH
https://www.smh.com.au/business/the...-on-lower-interest-rates-20191202-p53fwy.html

 

Wow.

“House values in Sydney alone increased by 3.1 per cent, taking the median house value to $956,249. It was a $37,900 increase through the month, with values now up by 4 per cent this year.”

$37,900 is a fair chunk of most people’s annual take home pay, or in another way to see it, an increase more than $1k a day.

 

Annualised, that's 37.2 percent!

When interest rates hit 0.25% middle of year year, do you think we could see house prices rising by 50% per annum?

Exciting times!!

 

Couple of things.
1. I wouldn't expect to see interest rates hit 0.25%.
2. I wouldn't annualise a 1 month figure.
3. So no, I don't expect to see a house price rise of 50% within a year.

I'm an optimist, and if house prices manage to double in 7-10 years I think that's awesome.

 

I think the trend is very clear. Last month recorded 3.1% (that's 0.77% per week - way off the graph - and fits the trend of the graph.)

 

There was one time since the 1970’s when house prices went up 50%... it was Perth, 1989. Now as I said, I’d be happy with a doubling in 7-10 years. Note, in Sydney we’ve also had a massive boom 2013-2017 too. We are only just getting back to the peak again.
What we can learn from Australia's median house prices from 1970-2016 - Homely

 

What was interest rates at the time? Bet they were not 0.75% and heading to 0.25%

 

June 1989 rates hit 17% and stayed there until April 1990.

 

Our interest rates have pretty much been dropping since 2011*, and house prices in Sydney have gone up a lot (doubled) since then. That’s cool.
To ask for a 50% gain again within 12 months is a huge ask. I’d like it, as I’ve got interest in a few million dollars worth of Sydney property. But I doubt it would happen.

* I’ve edited the post

 

Good news for people who have properties in Sydney. Need to hurry up if you need to buy a long term family home. If it is investment, I think it is still not a good time.