The Melbourne Property Market Predictions for 2020
The 2019 property market withstood its fair share of ups and downs. Cautious buyers, apprehensive sellers, the banking inquiry and the reluctance of banks to lend saw some variable results in the first half of the year. After the federal election and another interest rate cut from the Reserve Bank, the Melbourne property market started to make some positive gains, with the end of the year showing a remarkable upturn in sales and clearance rates.
Low interest rates are good for buyers and particularly good for sellers as it has led to an increase in the demand for property. With not much stock available, sellers are well and truly in the box seat. This increase in demand can only fuel strong growth in the market. Experts believe the federal government’s First Home Loan Deposit Scheme could also add to the growing demand for homes.
BIS Oxford Economics and QBE Insurance have released their housing outlook with predictions for the property market over the next three years. Despite Australia’s slow going economy, they have predicted a strong positive outlook, forecasting that the Melbourne median house price is set to increase by 10.2%.
The market will continue to be buoyed by lower interest rates and improved lending conditions but the state of the national economy could throw a potential spanner in the works, particularly if wage growth doesn’t improve. If the house prices increase too much, affordability could become a problem. So, it’s unlikely that the market will hit astronomical highs, but should hopefully continue to enjoy gradual, steady growth throughout 2020.