By Chris Shaw<\/p>\n
Whereas the previous few years saw consumers enjoy a wealth impact from
\nhigher property prices such a scenario is unlikely over the next year
\nor so according to the latest assessment of the residential property
\nmarket by analysts at BIS Shrapnel.<\/p>\n
According to the group’s “Residential Property Prospects 2008-2011”
\nreport higher interest rates mean all of Australia’s residential
\nproperty markets are likely to experience only marginal price gains in
\n2008\/09, though any downturn is likely to be avoided and going forward
\nthe combination of high net migration rates and an undersupply of new
\nhousing will see housing price growth increase from 2009\/10.<\/p>\n
Author of the report, Mr Angie Zigomanis, suggests as construction
\nremains below previous peak levels despite strong underlying demand
\nvacancy rates remain at low levels and this will continue to push up
\nrental growth. These improved returns, combined with a recovery in
\ncredit conditions expected in 2009, will be the combination that drives
\nup property prices in most capital cities when the property market next
\nturns positive.<\/p>\n
In Mr Zigomanis’ view an improvement in credit conditions will allow
\nbanks to pass on lower borrowing costs to their customers and this will
\ndrive the property market. He suggests those markets best placed to
\nrecord gains through to 2011 are Brisbane, the Gold and Sunshine Coasts
\nand Darwin, as these regions combine strong underlying demand with
\nstrong employment and wage growth.<\/p>\n
Sydneysiders can also expect some price improvement as the recent
\ncorrection in the market generates increased demand, while Zigomanis
\nsees more modest growth from the Melbourne, Adelaide, Canberra and
\nHobart markets and weakness in Perth. The latter is due to “affordability issues”.<\/p>\n
In terms of specific regions Zigomanis predicts a median house price for Sydney of $550,000 for June this year, increasing slightly to $560,000 this time next year as part of total growth through to June 2011 of 18%, with
\nthis growth expected to be strongest towards the end of the period.<\/p>\n
Similar growth through to 2011 is expected in Newcastle as the region
\nbenefits from the lack of affordability in the Sydney market, while BIS Shrapnel expects the Woolongong region to record growth of 17% for the
\nperiod.<\/p>\n
Melbourne should record 10% price growth in FY08 to bring its median
\nprice to $455,000 by the end of June, while the group is forecasting price
\ngrowth of 16% and real price growth of 6% through to 2011. Brisbane
\nshould exceed this with 15% growth in FY08 to lift its median price to
\n$422,000 in FY08, with 11% real growth or 22% nominal growth expected
\nthrough to 2011. <\/p>\n
A similar rate of increase is forecast for both the Gold and Sunshine
\nCoasts, while Cairns and Townsville are forecast to deliver price gains
\nof 19% and 16% respectively as high levels of construction reduce the
\nshortfall of dwellings and offset to some extent the combination
\nof stronger economic conditions and lower median prices than
\nBrisbane.<\/p>\n
In the Adelaide market low vacancy rates imply a shortfall in dwellings
\nand affordability is better than in other capital cities but BIS Shrapnel
\nexpects the recent increases in interest rates to have an impact,
\nlimiting the city to growth of 16% over the next three years.<\/p>\n
The Perth market is tipped to struggle over the next two years as
\naffordability is currently poor but BIS Shrapnel expects strong wage growth to
\nsubsequently deliver some gains in 2011. By the end of FY11 Zigomanis sees an increase of 6%.<\/p>\n
A net outflow of people from Tasmania will limit the growth in Hobart
\nproperty prices in coming years and the group is forecasting an increase of
\n14% through to FY11, while a 15% increase is predicted for Canberra
\nafter a weak FY09 given uncertainty over public sector employment
\nlevels following the election of the new Federal government.<\/p>\n
Affordability appears reasonable in Darwin in comparison to other
\ncapital cities, particularly given the potential for higher income
\nlevels on the back of strength in the mining sector. This leads the
\ngroup to predict the city will enjoy price gains of 21% over the next
\nthree years, which equates to an increase of 10% in real terms.<\/p>\n","protected":false},"excerpt":{"rendered":"
The latest report by BIS Shrapnel suggests limited gains in residential property prices are likely in FY09, though the market should then improve through to FY11.<\/p>\n","protected":false},"author":9,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[5],"tags":[31],"acf":[],"_links":{"self":[{"href":"https:\/\/staging.fnarena.com\/index.php\/wp-json\/wp\/v2\/posts\/54344"}],"collection":[{"href":"https:\/\/staging.fnarena.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/staging.fnarena.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/staging.fnarena.com\/index.php\/wp-json\/wp\/v2\/users\/9"}],"replies":[{"embeddable":true,"href":"https:\/\/staging.fnarena.com\/index.php\/wp-json\/wp\/v2\/comments?post=54344"}],"version-history":[{"count":0,"href":"https:\/\/staging.fnarena.com\/index.php\/wp-json\/wp\/v2\/posts\/54344\/revisions"}],"wp:attachment":[{"href":"https:\/\/staging.fnarena.com\/index.php\/wp-json\/wp\/v2\/media?parent=54344"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/staging.fnarena.com\/index.php\/wp-json\/wp\/v2\/categories?post=54344"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/staging.fnarena.com\/index.php\/wp-json\/wp\/v2\/tags?post=54344"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}