The latest Finder RBA Cash Rate Survey, which polled 40 experts and economists, has tipped Melbourne to become the nation’s house price leader over the next 12 months:
Experts are predicting the property market to continue to run for the next 12 months, – especially in Melbourne, where a predicted 9% price increase would increase the average home price to $817,114.
The predicted 8% increase in Sydney would see property prices increase another $76,619 on average.
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Graham Cooke, head of consumer research at Finder, said that lockdowns seem to have had little effect on house sales.
“The average Sydney homeowner earned more than the median family wage over the last 12 months in property equity alone, and it looks like they are set to repeat that over the next 12,” Cooke said.
I don’t agree with this assessment and believe that Brisbane is more likely to lead house price growth over the next 12 months.
First, Brisbane has a massive affordability advantage over Sydney and Melbourne, with Brisbane’s median house price tracking close to a 50 year low against both markets:
Second, thousands of residents have already left Sydney and Melbourne for Brisbane:
With both Sydney and Melbourne now suffering long and painful lockdowns amid worsening COVID outbreaks, we are likely to see many thousands more residents leave these two cities for a fresh start in Brisbane, where affordability and lifestyle is far more appealing.
Net overseas migration is also unlikely to rebound over the next 12 months, which will remove a fundamental demand-driver of Sydney and Melbourne property.