CoreLogic head of research Tim Lawless believes the pain for home owners in Australia’s biggest property markets will be over within the space of 12 months.
“Short-run forecast suggests that the Sydney marketplace will continue along its trajectory of decline but still seeing a continual moderation in the rate of decline before bottoming out around about the first half of 2020,” said Mr Lawless.
This is in line with predictions from accounting giant KPMG.
“To sum up, conditions are probably going to remain weak for some time, we are probably through the worst of it. Credit availability will be the key factor to be watching in this marketplace, that’s what has really inspired this downturn” said Mr Lawless.
“This is simply a momentum-based forecast so it does not factor in macroeconomic conditions, lower interest rate, change of political policies around taxation, so anything could happen,” Mr Lawless added.
Young Aussies step in
It is believed that first home buyers who were previously unable to afford a house will drive the recovery through the purchasing of apartments in Sydney and Melbourne.
“Low mortgage rates, high population growth and improving affordability should help to offset the impact on activity from tight credit,” said Mr Lawless.
Despite the falling property market, properties in Sydney and Melbourne are still 9.1 and 8.2 times the average household income, respectively.