17/09/2018 - 15:19

House values forecast to decrease to 2020

17/09/2018 - 15:19

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New research from Moody's Analytics has forecast Perth house values to fall slightly in 2018, and again in 2019, before a slow recovery in 2020.

Photo: Gabriel Oliveira

New research from Moody's Analytics has forecast Perth house values to fall slightly in 2018, and again in 2019, before a slow recovery in 2020.

The CoreLogic-Moody’s Analytics Australia Home Value Index Forecasts predicts declines in all capital cities, led by Sydney and Melbourne.

The report said the Perth market was starting to stabilise, as a result of rebounding commodity prices, which in turn was leading to a recovery in income growth.

Perth is also being supported by stabilising population growth of about 1 per cent annually.

House values in the greater Perth region are forecast to fall 1.9 per cent in 2019 and a further 0.5 per cent in 2019, before ticking upwards 1.4 per cent in 2020.

Apartment values are likely to fall 4 per cent in 2018 and 0.9 per cent in 2019, before increasing 2.5 per cent in 2020.

House values in inner Perth are forecast to grow 3.3 per cent in 2018, 4.1 per cent in 2019 and 2.8 per cent in 2020.

The report said unemployment in Western Australia had improved significantly from 2016 although further improvements are likely to be more moderate.

The housing market is not anticipated to recover until 2020 and values will not reach the 2015 peaks during the report’s forecast period.

House values in Mandurah are currently about 30 per cent below their 2007 peak and will fall approximately 4.8 per cent in 2018 and 2 per cent in 2019, with an increase of 1.9 per cent in 2020.

Nationally, the August CoreLogic Hedonic Home Value Index, on which the analysis is based, decreased for the 11th consecutive month.

House values have fallen 2.5 per cent from their peak in late 2017 while apartment values are down 1.7 per cent.

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