Yesterday, CoreLogic’s daily dwelling values index hit a triple milestone for 2020.
First, the 5-city index finally turned negative (-0.01%) for calendar year 2020:
Yesterday, Melbourne’s decline from its most recent peak (on 6 April 2020) hit 6.0%, whereas Sydney’s decline from its 5 May peak hit 3.0%:
Looking ahead, we expect mortgage demand to increase as the Reserve Bank of Australia monetises the mortgage market via the Term Funding Facility (TFF) and the Morrison Government abolishes responsible lending laws.
On the other hand, the collapse in immigration and the unwind of emergency income support (see next chart) will weigh on prices in 2021.
It’s going to be a titanic ‘tug-of-war’.