Australia economic and property report 2021

Australia Economic and Property Report 2021

Australia’s property market exceeded all expectations in 2020 and in the first half of 2021. The ‘doom and gloom’ and ‘market crash’ predictions did not eventuate, in fact, the opposite occurred…

 

Australia’s Property Market Tests Positive: Will It Require Another Injection?

Australia’s property market exceeded all expectations in 2020 and in the first half of 2021. The ‘doom and gloom’ and ‘market crash’ predictions did not eventuate, in fact, the opposite occurred…

PRD’s latest property market insights report, the ‘Australian Economic and Property Report 2021: Property Tests Positive: Will It Require Another Injection’, reveals that on average, median house prices held steady in capital city markets in the 12 months to the first half of 2021, grew even further in metropolitan markets and soared the highest in regional markets.

 

PRD Australian Economic and Property Report 2021

PRD Chief Economist, Dr Diaswati Mardiasmo, believes “the property market has changed in leaps and bounds due to multiple factors within the industry, society, and government policy.The property market returned stronger than before once restrictions eased and employment started to recover, mostly due to built up household income and pent-up demand. However, there is another side to this – property prices have broken records which has led to Australians taking on higher debts and an inflation of lower-end priced homes.”

PRD Managing Director, Todd Hadley, further commented “the market has performed extraordinarily, and PRD’s latest report shows how government stimulus and historically low home loan rates played a key role to this success. The report also highlights that there may be a need for further government-led injection in the future.”

PRD’s ‘Australian Economic and Property Report 2021’ includes property market data up to and including June 2021 and captures the impact of COVID-19 and other policies introduced since April 2020.

Key findings include:

  • Australia’s capital city, metropolitan, and regional markets recorded median house price growth in the 12 months to the first half of 2021. Regional markets lead at an average of 12.7%. Darwin and Brisbane lead capital cities with a median house price growth of 23.4% and 11.6%.
  • Consumer confidence is at an all-time high which will increase demand for goods and services across multiple industries, creating a multiplier effect for economic growth.
  • The imbalance in rental supply and demand is clarified in vacancy rate patterns with many capital cities seeing a significant decline since the height of COVID-19 in April 2020. There is a rental shortage in many areas in urgent need for a housing supply injection
  • Housing finance commitment is at an all-time high at $32.6 billion as of May 2021. Australians are in higher debt by 1.1% for first home buyers and 2.6% for others. Historical low home loan mortgage rates have kept the home loan affordability index and proportion of family income devoted to meeting average loan repayments on an equal footing.
  • The Time to Buy a Dwelling Index suggests many Australians are starting to feel the sting of property price increases with an average decline of -5.5% in the 12 months to June 2021.

No doubt we are seeing a different property market compared to 12 months ago. At present, local Australian buyers are still sheltered from the usual international demand as our borders remain closed. Now is the most affordable and advantageous time for first home buyers, especially as many banks and lenders are signalling an increase in their interest rates”, Dr Mardiasmo said.

“The key going forward will be increasing levels of employment, wage growth, and COVID-19 lockdown risk management systems. This will set the scene as to whether or not we will require more government-led injection to ensure our purchasing power and affordability levels remain”, Mr Hadley commented.

 

PRD Australian Economic and Property Report 2021

PRD

Discover your dream home. ideal Real Estate Agent. latest Investment Property. perfect Business HQ.

Sell. Buy. Rent. Smarter.

Call Now Button