House prices could rise up to 7% in 2014
Source: propertyobserver.com.au Thursday, 09 May 2013 By Larry Schlesinger
The housing market will strengthen further - probably from 2014 - with gains of between 5% and 7% tipped by Australian Property Monitors’ (APM) chief economist Andrew Wilson. However, Wilson is sticking with his recent 2013 forecast made at the start of the year of a 3% to 5% rise in house prices over 2013.
“I still think that’s the case, 5% to 7% is the next increment but I don’t think we will see that this year,” he told The Australian Financial Review.
RP Data-Rismark has dwelling values across the eight capital cities up 2.3% for the first four months of the year.
ABS preliminary figures for the March quarter recorded just a 0.1% gain in its capital city house price index - for detached houses only.
Wilson bases his higher post-2013 forecast on historical trends, where lower interest rates driving up house prices, but with a small time lag. He also made the interesting observation that a rise in interest rates could have spurred on a “boost” in house prices in growing markets like Sydney, Perth and Darwin.
“The revival of Australia’s housing markets in 2012 has been confirmed as leading indicators such as auction clearance rates point to a market heating up.