After the best part of a decade leading the country in real estate value growth, Sydney and Melbourne appear to be slowing down – and Canberra could be set to overtake them.
Find out how Canberra could be the Australian city most on the rise in the next few years and why this could put it on the map more than ever for future property owners.
Sydney and Melbourne's apartment market is likely to weaken
House prices in Sydney are projected to slow to five per cent during 2017 and 2018.
Sydney's housing-constrained market, in particular, is expected to weaken in 2017 and 2018, according to the Australian Financial Review. House prices are projected to slow to five per cent during 2017 and 2018, business research and forecasting service BIS Oxford Economics predicts.
This is in large part because the Australian Prudential Regulation Authority's plan to limit investment and thus tighten banks' mortgage loan growth, BIS Oxford Economics senior manager Angie Zigomanis explains. As a result, the apartment market will take the biggest hit because people will find it more difficult to get mortgages and they will leave the market. Then, investors will leave the market, too.
Melbourne may also see a price drop but mostly because of a downturn in population growth. BIS forecasts that Melbourne's house price will fall to three per cent in 2017 and 2018. And the median unit price is predicted to fall by four per cent in three years.
Positive projections for Canberra and ACT
By contrast, Canberra is projected to see house price growth over the next three years, BIS reports. Indeed, the population in ACT has grown more than any other state, the latest census found. They've had more than 40,000 new residents in the past five years, an increase of 11 per cent.
A Deloitte business report also recently said that there are signs of positive growth for ACT's housing market because the Feds are returning to a state of equilibrium. Plus, lower interest rates are boosting the ACT economy.
In addition, Canberra has high incomes and will be able to help the house price growth. In fact, among all of the states, ACT is the wealthiest with a median personal income of $998 dollars per week, according to the census.
Here at Ray White Belconnen, we're excited to help people buy or rent in Belconnen because it is a thriving area of Australia. If you're considering moving here, don't hesitate to contact Ray White Belconnen today.