House price growth 'to continue for next three years'
House prices are expected to rise over the next three years, defying predictions of an Australian property crash, new research has found.
According to QBE LMI's Australian Housing Outlook report by BIS Shrapnel, the strongest growth will be in Perth, Sydney and Adelaide during the three years to June 2013, with all three cities expected to experience median house price rises of around 20 per cent during the period.
More moderate house price growth of 15 per cent and 13 per cent was predicted for Brisbane and Hobart, respectively, while the weakest price growth has been forecast for cities with constrained affordability and fewer pent up-demand pressures including Darwin and Melbourne where there is expected growth of 12 per cent and nine per cent, respectively.
Ian Graham, chief executive officer of QBE LMI, noted that while a range of factors have caused prices to moderate this year, first-home buyer demand is forecast to return to normal levels, believed to be around 130,000 to 140,000 loans approved in 2011. Such comments suggest more Aussies may be looking to compare home loans from next year.
"The expiry of the First Home Owner's Grant Boost Scheme at the end of 2009 and several interest rate rises between October 2009 and May 2010 had the effect of moderating house price growth in the first half of 2010," he observed.
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