That old trick of pushing it back. The Flying Circus:
Since March we’ve maintained that national house prices would likely flat-line to fall by up to 5 per cent over the next three to six months following which the boom that started in June 2019 would reassert itself. Consensus predicted falls of between 10 per cent and 30 per cent. Thus far the market has obeyed the script with CoreLogic’s national index declining by only about 1.5 per cent since I aired our view in a podcast on March 24.
Prices appreciated over March and April, and have gradually drifted lower thereafter. Auction clearance rates rebounded strongly prior to the surprising second wave in Victoria, which could delay the national recovery until the first quarter of next year given the seasonal downturn in prices over December and January. A second wave in NSW is another downside risk. I know the perma-bears would love for me to change my tune, but I am comfortable with the idea that this shock ends with a decent dose of house price inflation.
Prices are falling faster than previous corrections at the comparable time. At the current pace, we will see prices down by 10% in Sydney and Melbourne by the new year.
Whether it turns then will depend entirely on whether or not immigration is restored.