Isolated illustration of a house surfing downwards on a declining graph

Housing Not to Rise Until 2021

2018 has seen the beginning of the downturn for Aussie housing demand and prices. While many may be rushing to put their house on the market before it bottoms out, auction clearance rates around Australia have dropped well below the 50% mark.

The Banking Royal Commission findings have seen banks react by tightening lending regulations. And according to AAP, the housing market slowdown will continue in Sydney and Melbourne, but growth is expected in Brisbane and Adelaide.

Pullback expected for Sydney and Melbourne

The two largest property markets in Australia — Sydney and Melbourne — are predicted to fall by 1.2% and 2.5% by June 2021, respectively.

QBE Insurance released data on Thursday, forecasting a fall in the price of units. They expect a 2.1% fall for Melbourne and 3.1% fall in Sydney.

Unfortunately for homeowners trying to get into the market in Australia’s other capital cities, especially Adelaide and Brisbane, house values are expected to increase by 12.4% and 11.3%, respectively.

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Apartment owners will be hit the hardest

Phil White, QBE Lenders’ Mortgage Insurance chief executive, forecasts a large slump for apartment owners, as increased supply and weaker demand for units continues.

According to AAP, Mr White said:

We anticipate foreign investment will further dampen in coming years owing to a number of factors such as increased approval fees, stamp duty and land tax surcharges

As well as tighter capital controls from foreign governments, most notably China, which have impacted how much money they can take out of their country.’

He believes that high overseas migration and population growth means that housing market drops will be limited.

While Sydney and Melbourne saw massive growth between 2012 and 2017, these markets are now coming back down to Earth.

Sydney saw an increase by 84% during this time. It has now fallen by 7.6% in 2018.

According to the report, they predict a fall of 4.2% in 2019, and for them to bottom out in 2020.

But 2021 sees the market rising by 2.3%, according to data.

Free Report: Why Australia’s three-decade, recession-free ‘miracle economy’ is nothing more than a ticking timebomb. Download now.

Alana Sumic

Alana Sumic

Alana Sumic is an editor and writer for The Australian Tribune. She has a Bachelor of Arts from La Trobe University and a Masters in Publishing and Editing from Monash University.

She specialises in national and international politics and current affairs. She’s passionate about delivering the unfiltered stories that matter to you, on all topics.

Comments: 3

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  1. Great propaganda article, Adelaide and Brisbane property bubble going up another 10+% in this environment? Tell em they’re dreamin

  2. It’s all been due to so many stupid idiots prepared to debt up and pay ludicrous and obscene amounts of money for houses. Meanwhile so many regional areas across Aust. have had declines in values. So many stupid idiots…

  3. Put all the housing fiasco down to low interest rates…I can hear my words now ‘ if interest rates go to record lows housing prices in this country will go through the roof ‘ Well bless me if that is not what has happened. A child could see that coming but not those who laud over us it would seem. How reality restores itself is beyond belief. And forget all the nonsense about ‘values’…a nebulous term if ever there was one.