Dear Fellow Property Investor,
A major bank is expecting house prices to run hot for the rest of the year – but renters already struggling with the cost of living will battle to keep a roof over their heads.
NAB has increased its near-term forecast for the capital cities to an eight percent rise in house prices, up from the previous forecast of 4.7 percent.
While the bank predicts price gains will ease in 2024 back to five percent, this still represents a whopping 13 percent growth in what property buyers need to fork over in just two years.
Adelaide homes are expected to gain 8.6 percent in value for the rest of 2023 and then slow to a 6.2 percent gain next year.
PropTrack senior economist Eleanor Creagh told realestate.com.au that a lack of choice was driving up prices in the smaller capitals.
However, Ms Creagh said another smaller capital, Hobart, was not performing so strongly with prices increasing by 6.6 percent from the March 2022 peak.
‘However, this comes after several years of outperformance as well as strong growth during the pandemic. Home prices in Hobart are still up 38.4 per cent since March 2020, ‘ Ms Creagh said.
NAB predicts Hobart prices will actually dip 3.3 per cent this year and be flat in 2024 – meaning there’s at least some hope for first-home buyers looking to get their foot on the property ladder.
Sydney values are set to increase by 11.6 per cent in 2023 before slowing to five per cent in 2024.
Melbourne is only the capital predicted to see the price increases accelerate next year from 4.7 per cent to 5.5 per cent.
The housing shortage continues to spell bad news for renters with modelling released in August by Suburb trends forecasting many tenants could face increases of over $100 per week by next year.
In Dee Why, on Sydney’s northern beaches, rents are forecast to increase by a whopping more than $300 a week and $200-plus increases are also forecast for other popular areas in the city.
Queensland renters living in Surfers Paradise, Broadbeach and Isle of Capri can expect to paying an extra $170 a week by 2024.
Houses and units in the Victorian capital’s suburbs of Port Melbourne, South Melbourne and Southbank are facing the steepest increases in that state, with average rents forecast to go up by $165!
In hundreds of other Aussie suburbs, rents are forecast to rise by less than $50 per week.
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