2021 was a landmark year for property growth in Australia… so what is the property forecast for 2022?
Nationwide, 2021 saw a rise of more than 22% in average property values. While unpredictability has become the name of the game due to COVID, a few factors are likely to influence the market this year.
Australian property in 2022
Property prices here in Australia aren’t expected to soar in the way that they did through 2021 but they are not expected to drop either. Instead of exponential rises, it is expected things will be more slow and steady.
December figures indicated the trend for 2022 by showing only 1% growth (the average high for the year was 2.8% in March). This change is partly due to the new Australian Prudential Regulation Authority (APRA) rules, which are limiting people’s borrowing power.
According to corelogic.com.au, the variation between growth across the country is likely to become more pronounced in 2022. Sydney, Melbourne and Perth markets are now easing off somewhat after a very big year, while Adelaide and Brisbane continue to climb more quickly.
While every suburb and even every street has its own trend, here’s an overview for each major city and the regions:
• Sydney: The Sydney market seems to have pumped the brakes after an enormous year. Most likely this is the result of borrowing power being capped by the APRA. Sellers can still take heart that their property value experienced significant growth in 2021.
• Victoria: The Victorian market is in the same position, with price growth slowing at the end of 2021.
• Perth: While the upward trend in Perth is also slowing, it may be for different reasons. The West Australian market has most likely been affected by border closures and a lack of new arrivals, which have reduced demand.
• Brisbane & Adelaide: Prices are still rising steadily in these cities. This is more than likely because both cities are more affordable than Sydney and Melbourne, meaning the cap on
borrowing has not had the same effect on buyers’ pockets.
• Regional Australia: Regional areas look set to see strong growth in 2022 as more families make the decision to leave larger cities in search of better work/life balance. As shared by CoreLogic, “Since March 2020, housing values across regional Australia are up 32.0% compared to the 20.0% lift in values seen across the combined capitals.” This is great news if you are considering selling.
What’s in store in 2022?
While COVID-19 remains a wild card that could send the market in any direction, in general, prices are expected to continue to rise albeit at different rates in different regions.
Prices will also depend on the number of properties for sale in the area. Over the last two years, the increases have been a result of low interest rates, high demand and fewer people putting their homes on the market. While interest rates are expected to stay low, if stock remains limited, prices will continue to increase, especially in areas where people have larger budgets.
So what does this all mean for you as a buyer or seller?
• As a buyer, it makes sense to act quickly to secure your next home.
• As a seller, you can still take advantage of low interest rates and limited stock. Book your initial discussion with a Professionals agent today.
At the end of the day, if you need to buy or sell, it doesn’t matter what the forecast is. If you’re investing, you can still be selective and find a property which should generate positive returns over the next five years.
To get an idea of whether the time is right to sell or buy, contact your local Professionals representative.
