According to ANZ economists, Australian house prices will push modestly higher in 2018 and ramp up in 2019.
National house prices are just 0.8 per cent higher than last 12 month – compare to 10 per cent growth in the previous year – but ANZ doesn’t expect the slowdown to deepen from here.
“We think most of the slowdown has already occurred,” the economists wrote this week. “We retain our view that prices will not materially decline”.
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 to-level regulatory pressure.
From 4 major key Factors effects property price
- Supply and demand
Put simply if demand for houses increases faster than supply, then house prices go up. For house prices to fall the demand needs to fall.
- Interest rates
When interest rates rise, mortgage lenders generally increase the cost of variable mortgage payment. These higher interest rates in turn make home buying less attractive. Since the majority of Australia homeowner has variable mortgages, even a small change in tersest rates can have a gi impact on the affordability of buying a house.
- Economic growth
As the economy grows and wages increase more people can afford buy a house, this in turn increases overall demand, which increase prices.
As levels of migration increase so do the population and more people means more demand for homes.
Highest Population rise in all states, increasing more than 100,000 by 2017. Almost 80% from international migrates and 17% migrates from interstate move to Victoria.
Victoria has most economic performance in 5 capital city, grouping by 3.33%. creat in 88% jobs, unemployed rates drop from 6.8 % in March 2017 to 5.2 % in Nov 2017
|Population Growth Rate||2.34%|
|Gross State Product||$399b|
Melbourne market is continual under supply vacancy of the city near or below 2% 2017. As the population growth, the property market will be continually considered under supply.
Building approves level still produce across all type of last 12 month of December 2017. Housing approve has down 28%, apartment approve has down 27%.
2017 Supply / Demand
Vacancy Rates: Melbourne
|Oct 2017||Nov 2017||Dec 2017|
Annual Building Approvals
Housing market has still 16.6% of capital growth in 12 month of October 2017. With robust under line of economic more affordable than Sydney, Melbourne housing market is keeping attractive market, despite the growth rate is showing signs of moderation
2017 Housing Market
|Median Rent||$420 per week|
|AVM Rental Yield||3.3 %|
|Rental Increase||$20 per week|
Apartment market enjoyed 6.8% of capital growth for last 12 month to October 2017. Higher quality of choices, relative affordable compare to house at convenience in the city bay compare city French house land living are strong drive this growth.
2017 Apartment Market
|Median Rent||$400 per week|
|AVM Rental Yield||4.4%|
|Rental Increase||$20 per week|
|Rental Change||5.3 %|
Outlook in 2018, Melbourne market will continue to be under supplied. Affordability is a growing concern for many with increasing demand for townhouses and well designed the located apartments. And rental market will continue perform strongly with vacancy rate remain low. Melbourne’s ongoing population boom will continue under pin the strong demand of the market. As demand stay as high, supply new properties slow down due to more difficulty development conditions and state government planning changes, so this will place further pressure on prices and rents， but the slowdown has already occurred and it would be back on 2019.