Housing Market Crash?

Dec 21, 2017 | Global Property

Melbourne and Sydney’s housing market has been prophesised by many to come crashing down, it has been claimed that the housing market is a bubble that will burst to leave many devastated investors. However, Paul Bloxham Chief Australia and New Zealand Economist at HSBC has foretold that the housing market is more likely to experience a soft landing rather than a crash in 2018.

Bloxham believes that there is still further room for growth in the housing market in 2018, but it will be significantly decreased from 2017. Bloxham say that his predictions for the value growth of the housing market for 2018 are unchanged since July. HSCB is expecting between 3-6% growth for the year. Melbourne is expected to have a price growth of 7-9%. Sydney, however, will have marginally less price growth and is expected to return to between 2-4% increase in 2018.

 

(Source: CoreLogic)

Bloxham believes reasons for the recent decrease in house prices are “housing supply has ramped up, as an apartment building boom has delivered new dwellings to market” and “foreign demand has pulled back”. He also says, “prudential settings have been tightened, which has also included an increase in lending rates for investors.” Which may have helped cause the decrease in interest, across the housing market.

2018 is expected to show minor gains in price growth for the smaller capital cities of Australia, although not enough to compensate for Melbourne and Sydney’s loss in price growth.

<a href="https://ugc.net.au/author/brett/" target="_self">Brett Dickinson</a>

Brett Dickinson

Brett is a Licensed Real Estate Agent and manages United Global Capital's property projects and client acquisitions.

Recent News

Episode 114: Have The Markets Reacted To a COVID-19 Normal World?

Episode 114: Have The Markets Reacted To a COVID-19 Normal World?

This week’s edition of the investor exchange podcast kicks off with a discussion on the COVID-19 situation in Victoria. It’s been 20 days since Victoria recorded its last case and is on track towards a COVID normal Christmas. Following that, Louis talks about the benefits of holiday for your mental health which in turn impacts our performance in work and in life. Brett takes us through the changes in stamp duty that will soon be in place for home buyers soon and breaks down what the costs and benefits will be. Finally, Joel provides a share market update and highlighting the current situation in the United States.

STAY UP TO DATE

Subscribe here to receive all UGC updates as they happen

Good Move! Keep an eye on your inbox for our next update.