According to The Australian Financial Review, the slowdown in house prices is expected to continue until 2021, with Sydney emerging as the capital city with the worst prospects while Brisbane surprises as the city with the most upside, economic forecaster BIS Oxford Economics says.
Sydney house prices are about to do a flip on the residential boom that occurred between 2013 and 2017, managing a total growth of only 3 per cent in the three years to 2021. During the boom, prices grew a whopping 85 per cent, BIS report Residential Property Prospects 2018 to 2021 says.
In a close second for limited growth is Darwin, where BIS predicts median house prices will rise about 5 per cent in the next three years, while Melbourne, the other big market, will notch up 6 per cent.
However, BIS does not see a crash as being on the cards, with any major slide in prices being mitigated by very strong population growth and continued low interest rates. Population growth will absorb the huge supply of new dwellings from the recent boom, although any growth in rental will be minimal, BIS says.
Discounts in rents may even occur, but with homes filled forced sales will be unlikely.
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