Summer ends with a hot February market
In February the Real Estate Institute of Victoria (REIV) recorded more than 3,697 auctions. 2,443 properties sold. 1,856 at auction, with 684 passed in. 586 were sold before auction & 1 property was sold after auction.. The clearance rate was 79.25%.
As the glorious summer comes to an end we have a vibrant auction market with strong supply and very high sales volumes. With plentiful stock, demand will ease a bit, slowing down the breakneck value growth. But the return to normality means vendors can plan with confidence and it’s a good time to sell.
Australia opens up at last
The Federal Government opened Australia’s borders on Feb 21, which impacts the housing market. There’s a queue of cashed-up expats coming home and a bigger queue of waiting migrants. Most overseas immigrants rent at first and then move on to home ownership. These new arrivals bring more demand in both rent and buy sectors.
International home-buyer searches are currently topped by the US, with New Zealand and the UK second and third (realestate.com.au). Chinese buyers have dropped to number eight on the list.
Banks predict a correction in 2023
The banks are all predicting growth over 2022 but it all hinges on more RBA interest rate rises, which the banks believe are coming and will impact significantly by the end of 2023.
Nationally, CBA forecasts a 7% rise in values in 2022, but if the RBA has lifted the cash rate to 1.25% by the third quarter of 2023, CBA predicts it will cause a 10% drop in values.
NAB is forecasting a 4.9% rise in values for 2022 and a 4% fall next year. ANZ says we’re in for a 6% jump this year and 4% drop in 2023.
Westpac had predicted an 8% rise over 2022, but has just recently (February 23) revised that down to a 2% rise, with a 7% drop over 2023.
So there’s a bit of uncertainty there. The banks are the experts but they have been wrong before. Time will tell!
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