The real estate market is expected to continue to face policy, supply and demand challenges for the remainder of 2022

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Tilted to weather the headwinds of politics, supply and demand for the remainder of 2022, the Australian property market has changed with markets operating within markets, all at different speeds.

The 2022 edition of the PRD’s Australian Economic and Housing Report revealed a slower pace of median house price growth nationwide in the 12 months to June 2022, compared to the same period of 2020 to 2021.

PRD Chief Economist Dr Diaswati Mardiasmo said the real estate market as we know it has changed dramatically over the past 12 months.

“Doom and gloom were predicted throughout COVID-19, but the market has thrived. Now, in 2022, we have markets within markets, moving in different directions and at different speeds,” Dr Mardiasmo said.

In the 12 months to the first half of 2022, the report notes that capital markets nationwide recorded average median house price growth of 6.3%.

This figure is beaten by the gigantic median increase in house prices of 15.5% over the same period to the first half of 2021.

That said, Dr. Mardiasmo noted that capitals now behave differently.

“Sydney and Melbourne have seen a turning point in their markets, with a decline in median house price growth,” she said.

“Brisbane, Perth, Hobart and Darwin haven’t.

“There is more uniformity in regional markets, all maintaining double-digit growth rates.”

PRDMedianCapitalCity.JPG

Source: PRD Australian Economic and Property Report 2022

In the three months to the June 2022 quarter, the PRD’s ‘Time to Buy a Dwelling’ index found that residents of QLD and TAS were the most reluctant to buy property, reducing -26.8 respectively % and -38.8%.

On the other side of the coin, residents of VIC and SA showed an eagerness to capitalize on falling prices with the index rising 5.6% and 16.3% respectively.

Each year in the 12 months leading up to the June 2022 quarter, the Time to Buy a Home Index decreased for all states.

PRDIndex.JPG

Source: PRD Australian Economic and Property Report 2022

With markets within markets now operating with their own minds, Dr Mardiasmo said the issue of supply and demand imbalance is important, proving to be at the heart of price movement.

“Over the past 12 months (to July 2022), we have seen this imbalance worsen, with demand outstripping supply, in both the sale and rental markets,” she said. .

“The depth of this imbalance will determine the growth of prices in a region.

“Many other events and disruptions will color the remainder of 2022 and 2023, creating an endless seesaw in the balance between supply and demand in the Australian property market.”

Market drivers to ‘soften the blow’ from slowing real estate market

Despite the Sydney and Melbourne markets boiling on the back of rising mortgage rates and cost of living pressures, PRD is confident that market drivers will remain firm to prevent a severe or prolonged downturn in the housing market. lodging.

PRD chief executive Todd Hadley said a number of market drivers should cushion the blow in the near term despite further interest rate hikes, higher inflation and falling house prices. .

“Employment figures are exceptionally strong, wage growth is starting in some sectors to offset the rising cost of living, rising rental prices will make buying a home more attractive to tenants and there will be a big increase in international tourism,” Hadley said.


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Image by Daniel Pelaez Duque via Unsplash

The whole market has not been taken into account in the selection of the above products. Instead, a reduced portion of the market was considered. Products from some vendors may not be available in all states. To be considered, the product and price must be clearly published on the product supplier’s website. Savings.com.au, yourmortgage.com.au, yourinvestmentpropertymag.com.au and Performance Drive are part of the Savings Media group. In the interest of full disclosure, Savings Media Group is associated with Firstmac Group. To learn how Savings Media Group handles potential conflicts of interest, as well as how we are paid, please visit the website links at the bottom of this page.

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