THIS MONTH IN RAY WHITE NOW
We ’ re now three months into a return to price growth and with interest rates now possibly peaking , it looks like this growth will continue for at least the short term . Population growth continues to accelerate and the ongoing construction crisis is set to result in too few homes being built for many years to come .
Peak to trough declines ended up at 6.5 per cent , representing a fall that was far less dramatic than the extreme growth we saw through the pandemic . Right now it ’ s looking like we will be back to the pandemic peak in the second half of 2023 . In places like Adelaide and Darwin , where prices barely moved last year , we ’ ll be back to peak by June .
Leading the way in the recovery are the suburbs that saw the biggest drops during the downturn , and the biggest increases in the pandemic . It includes suburbs like Manly and Mosman in Sydney , Dural in the north-west of Sydney and Cottesloe in Perth . All of these suburbs have seen prices increase by over $ 60,000 since December 2022 .
What could change the outlook for price growth ? There ’ s certainly less likelihood of further drops in prices than there was just three months ago , however the main risk factor is the large number of low fixed price mortgages being reset to variable rates . Ideally , households will be well prepared for this change , particularly given rates started rising 12 months ago .
This month we take a look at what is driving the faster than anticipated return to price growth and estimate when we will get back to the 2022 house price peaks in each capital city . For our commercial property insights , we investigate what ’ s happening to foreign investment . While we ’ ve seen a big fall in foreign investment in
residential property , the declines have not been as extreme in commercial .
We hope you enjoy reading this month ’ s Ray White Now .
Nerida Conisbee Chief Economist Ray White Group
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