G’day, mates! If you’ve been dreaming of owning your own slice of Australian paradise, you might want to act quickly because the housing market is about to get wilder than a kangaroo on a pogo stick! According to the folks at KPMG, house prices are set to skyrocket over the next 18 months, and let’s just say, it’s going to be a real rollercoaster ride for struggling homebuyers.
Get Ready to Break the Bank!
In their latest report, KPMG’s Chief Economist, Dr. Brendan Rynne, warns that house prices are preparing to do some serious acrobatics. Even though interest rates are high enough to make your wallet break into a cold sweat, the supply of houses is about as scarce as a Tasmanian tiger sighting. This scarcity is expected to keep pushing prices higher and higher, like a didgeridoo reaching for the stars.
So, why are house prices going bonkers, you ask? Well, first off, there’s this little thing called “constrained supply.” With land as rare as a dingo in a tuxedo, approvals for new constructions dropping like gum leaves in autumn, and building costs going through the roof, we’re basically sitting on a property powder keg ready to explode.
Immigration: The Wild Card
But wait, there’s more! Remember the post-pandemic recovery in immigration? Well, that’s expected to add even more fuel to the fire. It seems like everyone wants a piece of the Aussie pie, and we’re running out of slices.
The Numbers Don’t Lie
Hold onto your cork hats because here come the numbers. According to KPMG, house prices are going to rise nationally by a whopping 4.9% over the next 9 months. Then, like a sugar glider on a sugar rush, they’ll leap by an astonishing 9.4% in the year to June 2025. Apartments are also in on the action, expected to rise by 3.1% by June and then another 6% in the next 12 months. It’s like a real estate party, and everyone’s invited!
Rate Cuts to the Rescue?
But don’t despair just yet, mortgage warriors! KPMG is also predicting rate cuts by the next financial year. So, you might just catch a break. These rate cuts, combined with immigration and more relaxed lending conditions, are like a triple-shot flat white for the property market.
Rent vs. Buy: The Ultimate Showdown
As rental costs skyrocket and finding a vacant place becomes as rare as a platypus sighting in Sydney, the dream of homeownership might start looking more appealing. KPMG thinks that when renting becomes as expensive as buying, Aussies might just decide to take the plunge into homeownership. After all, it’s hard to resist the call of your very own backyard barbie!
Units: The Rising Stars
Sydney, Melbourne, and Hobart are predicted to be the superstar cities, with units experiencing larger gains than the national average in the next two years. So, if you’ve ever wanted a view of the Sydney Opera House from your bedroom window, now might be your chance.
Mortgage Stress: The Spoiler
Of course, not everything is sunshine and surfboards. The dreaded mortgage stress is lurking in the shadows. First-time buyers are now forking over half their earnings on mortgage payments, which is a bit like trying to surf without waves – not easy, mate!
A Word of Warning
So, while the housing market is about to turn into a real-life rollercoaster, keep in mind that half of all fixed-rate credit is estimated to expire this year. That’s approximately 880,000 Aussie households who might be in for a financial whirlwind. Hang on tight!
Get ready for the great Australian housing adventure of 2023! House prices are set to soar higher than a boomerang in flight, and if you’ve got your heart set on a piece of this land Down Under, you’d better start saving those pennies. Whether you’re a first-time buyer, a potential homeowner, or just someone looking for a laugh, the Australian housing market is about to give us all a run for our money. So, grab your surfboard, your savings, and your sense of humor because we’re in for a wild ride, cobbers!