I know this was sort of covered in the general predictions post from last week but thought it was worthy of it’s own discussion.
Here’s my 2 cents off the top of my head, so critique away in the comments.
Nationally, I’m going to call a 5% increase by end of 2022. Not much growth, enough in a couple of states but either neutral or negative in others.
Migration is the big unknown and although the business and real estate lobby is screaming for the return of migration, the question is how many will actually come back? It won’t be pre-pandemic levels in my opinion, but probably half that at most. Bear in mind a lot of the shitty service jobs are either gone or going in the next 12 months, so the incentive for Indian students working food delivery with an uncertain supply chain situation isn’t as big as before.
Apartment market is pretty much toast except for the Gold Coast (waves at Birchy) unless money laundering regulations are loosened even more, don’t count that one out.
Queensland will likely see the continued gains from people fleeing interstate shitholes (read: Victoria). I’m going to say 10% up by year’s end in Brisbane, with the Gold Coast and Tweed area with 15-20% gains. FNQ not so much due to the coup de gras for the tourism industry.
Victoria will probably be the only state going negative and I’m going to say 5% down for houses and 10% down for apartments. NSW probably about 5% up by year’s end for houses, apartments 5% down.
WA is the most intriguing for me. The border won’t open in my opinion, at least not any time reliably this year. Iron ore will probably sit around the $100-$120 USD ton rate it’s hovering about now, but won’t go anywhere near back to the $230 high of last year. What that means for WA in terms of housing and no-one allowed in the state I have no idea, but most likely stagnation.
No-one cares about the other states, but go long gulags in the NT.
The only thing that wipes all of this out is worsening inflation and rate hikes in the US, which look like they may actually happen now given this week’s announcement of the worst inflation since 1982. What the RBA does is likely nothing, but probably a few more token hikes by the commercial banks.
I’m going to call 50-year mortgages and unrestricted access to superannuation for house deposits before years end, as the de facto policy response before any kind of correction is allowed to happen. Evergrande won’t be as bad as people think, market seems to have already priced it in and we’re essentially in the era of no consequence.
Labor or LNP winning election is meaningless as the policy response will be basically the same. Oh sorry, almost forgot.
Don’t buy now!