2021 has been a huge year for real estate, with the property market growing over 20% throughout Australia, with many states and suburbs growing significantly higher than that.
According to most reports, the market is likely to run out of steam in 2022, with a potential interest rate rise likely to trigger a stabilisation in prices. The federal election is likely to happen in May, and if interest rates rise, it is likely to occur after May.
Although we had been in a lockdown state for much of 2022 due to COVID, market growth has significantly exceeded expectations. This has largely been due to low interest rates, and the 'Fear of Missing Out' factor for first home buyers.
See below for 'base case' property forecasts estimated by SQM Research in late 2020 for the market in 2021, compared with what actually happened in 2021.
Sydney - estimated price increase of 7%-11% (actual increase 25.2%)
Melbourne - estimated price increase of 2%-6% (actual increase 16.4%)
Canberra - estimated price increase of 5%-9% (actual increase 25.5%)
Brisbane - estimated price increase of 4%-8% (actual increase 22.3%)
Adelaide - estimated price increase of 6%-10% (actual increase 20.1%)
Perth - estimated price increase of 8%-12% (actual increase 16.4%)
Darwin - estimated price increase of 6%-9% (actual increase 19.3%)
Hobart - estimated price increase of 3%-7% (actual increase 28.1%)
For additional insight, please read the excellent 'Housing Boom and Bust' report by Louis Christopher at SQM Research, which provides forecasts, commentary and views regarding the housing market for 2022 - SQM Research - Property - Boom And Bust Report.
We hope you shared in the growth and success of the real estate market in 2021.
Please enjoy the festive season, and happy property investing for 2022!
Kind regards,
The PropertyDirector Team.
