east coast housing boom to roll on in 2017 : ) ... but 2018 : (

Discussion in 'Property Information Resources & Tools' started by Whiteman, 4th Jan, 2017.

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  1. Whiteman

    Whiteman Well-Known Member

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  2. Whiteman

    Whiteman Well-Known Member

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    Australia's east coast-centric housing boom will roll on in 2017 but could become unstuck in 2018, according to SQM Research founder Louis Christopher, arguably the country's most accurate forecaster.

    Mr Christopher expects capital city house prices to rise between six and 10 per cent next year, led by double-digit price growth in Sydney, Melbourne and possibly Hobart. There will be single-digit growth in the other capital cities, apart from Perth and Darwin where further steep falls are predicted.

    Looking ahead to 2018 the picture is gloomier, according to Mr Christopher. He believes both Sydney and Melbourne's housing markets will be "dangerously overheated and overvalued" by the end of 2017, paving the way for a possible correction.

    "The market will sustain its current momentum and rise again in 2017 – 2018 may be well another matter."

    [​IMG]
    The housing boom will roll on in 2017 but could come unstuck in 2018, according to arguably the country's most accurate forecaster. Cartoon Peter Nicholson
    His forecasts are worth noting. Over the past two years Mr Christopher has predicted capital city house price growth in line with the Australian Bureau of Statistics's Residential Property Price Index.


    He also correctly tipped Melbourne to be the strongest performing housing market ahead of Sydney. ABS figures show Melbourne prices up 6.9 per cent for the year to September, compared with 3.2 per cent growth in Sydney. Many economists, by contrast, got things wrong.

    "Economists are like GPs of the medical world – good generalists but not specialists. This particularly hurts them when understanding the leading housing indicators," he told The Australian Financial Review.

    Having spent the past 16 years analysing the dynamics of the housing market, firstly with Fairfax-owned Australian Property Monitors before founding SQM in 2006, Mr Christopher believes a number of key macro factors will continue to push up prices for at least another year.

    These, he said, include the current low interest rate environment, continued strong population growth especially in Sydney and Melbourne and – until very recently – a weak response to the supply side of the housing market.


    Purchasing power
    "We're getting around 90,000 new people coming to both Sydney and Melbourne every year. They all need accommodation and quite a lot of them have some home purchasing power.

    "The Sydney and Melbourne economies have kept the country out of recession and there's a strong correlation between a city's economy and their housing market," Mr Christopher said.

    His forecasts for 2017 are under a base case scenario of a steady economy, no changes to the cash rate, the Australian dollar hovering between 70¢ and 80¢ and no meddling in bank lending by the Australian Prudential Authority in the first six months of the year.


    Should the Reserve Bank cut the cash rate again next year, house price growth could be even greater. "It is now very likely it will be a strong start to the new year for Sydney and Melbourne, given the way 2016 ended," Mr Christopher said.

    Market leader CoreLogic's December 2016 Home Value Index, which came out on Tuesday, showed a bigger 10.9 per cent surge over the year with Sydney up 15.5 per cent, ahead of Melbourne, which rose 13.7 per cent.

    Mr Christopher believes the CoreLogic index overstated price growth in Sydney and other markets – a claim also made by the Reserve Bank. "We benchmark our forecasts agains the ABS data," he said.

    SQM monitors house price growth using its own Asking Price Index, which as its name describes monitors and analyses changes in the asking prices of homes. Its accuracy is based on the fact that nine out of 10 homes for sale in Australia include an asking price.


    The SQM index had capital city house prices up 4.9 per cent last year with Melbourne and Hobart both managing double-digit growth.
     
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  3. MTR

    MTR Well-Known Member

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    This has already been posted before and you tube.

    Firstly, these are predictions, may/may not come true, I think that we will see growth in 2017 for Syd/Melb but it may be fragmented ? once again I could be wrong.

    Also, they made it clear that this is also dependent that we do not see an interest rate increase or something that triggers the market. Otherwise the sky is blue, the sun is shining and love is in the air:)
     
  4. WattleIdo

    WattleIdo midas touch

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    Makes sense that Louis Christopher would get it right.
    A lot of them get it wrong a lot of the time. They oughta give up and leave it to the pros!
     
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  5. WattleIdo

    WattleIdo midas touch

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    Link to other thread, please?
     
  6. MTR

    MTR Well-Known Member

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    it's under Gold Coast official thread
     
  7. sash

    sash Well-Known Member

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    Hey WiDo...........where are your places?
     
  8. WattleIdo

    WattleIdo midas touch

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    Well not everyone wants to trowel through all that. Not going near GC too many questions left unanswered.
    I think it's a good article and a good way to start a thread.
     
    Last edited: 4th Jan, 2017
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  9. WattleIdo

    WattleIdo midas touch

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    I'm offended that you don't know already. :p

    Harris Park
    Frankston
    Parkes

    Why sash?
     
  10. marty998

    marty998 Well-Known Member

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    If everyone knows prices will crash in 2018, why would everyone keep bidding up prices in 2017???

    Are we all just lemmings fated to make bad decisions?
     
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  11. MTR

    MTR Well-Known Member

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    towards the end thread, easy to find, I am iPad can not give you link
     
  12. sash

    sash Well-Known Member

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    Just curious...Frankston and Harris Park have gone up quite a but when did ya buy them?
     
  13. WattleIdo

    WattleIdo midas touch

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    Because I'm a genius, of course.
    Edit: oh sorry, I thought you said 'why' but it's 'when'.
    HP was 2007
    Frankston was 2010.
     
    Last edited: 4th Jan, 2017
  14. sash

    sash Well-Known Member

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    When did you buy?
     
  15. WattleIdo

    WattleIdo midas touch

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    I can't work out which of us is sillier.
    Those years next to the suburbs show t eyear of purchase. ;)
     
  16. sash

    sash Well-Known Member

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    I any case you probably did ok ...nothing brilliant but nothing to crow about...

    Look at some of the strategies which MTR, Cactus, and Connor are employing ...most with a little bit of study can replicate them....but you will need an open mind.
     
    Last edited: 4th Jan, 2017
  17. jprops

    jprops Well-Known Member

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    Very bizarre sub-thread happening here...
     
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  18. JDP1

    JDP1 Well-Known Member

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    I would agree partly with this
    Sydney and Mel may slow down a bit but there will still be growth.
    Brisbane will continue to grow.
    Sydney/Mel will take a big step back only if their economies tank or if competition like Brisbane pick up in terms of jobs..or a decent amount of both scenarios happening.
    Can't quite see it happening because Sydney/Mel is still significantly ahead of the pack in terms of jobs.
    Most likely Brisbane will close the gap with Mel but not to a significant degree in 2017.
    Edit: I'm supposed to hype Brisbane..Goo brissy..giddy up I say
     
  19. WattleIdo

    WattleIdo midas touch

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    If I knew you were asking in order to act superior, I would've just ignored you. Should know better by now.
    Thanks for your unsolicited advice but I'm not at all interested in developing.
    I reckon you're the one making a big fuss but it's difficult to ascertain whether you have money because you were born with it, or because of your job, or because some of your investmets did ok. If you are so busy working, where do you get the time for research? If you're so busy I nvesting, where do you get the time for work?
    I prefer to follow the ones who I can see where they've come from and I like the looks of where they're going.
    I'm thinking you've been trying to catch me after the fancy pants post, hey. ;)
     
    Last edited: 4th Jan, 2017
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  20. RetireRich101

    RetireRich101 Well-Known Member

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    There are obviously not many fishing places in Parkes, that you didn't see it coming :p:D
     
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