forma condos.The volume and price of the global property market fell. The Australian real estate market created its first inflection point since the financial crisis in 2018.Please Visit: forma condos to Get Your VVIP Registration Today!
Average house prices in Australia fell nearly 5 per cent in 2018, according to the latest data from CoreLogic, a property research firm; by the end of 2018, average house prices in Sydney, Australia’s largest city, were down more than 11 per cent from their 2017 peak, surpassing the peak-to-trough decline during the recession 30 years ago. Some analysts said that the Australian property market has “entered the winter” and is expected to remain weak in 2019.
At the end of 2018, the property market in many countries and regions around the world cooled one after another. The “volume and price drop” in the real estate market is most obvious in Australia, as well as Hong Kong, Canada and other places. In addition, subject to the economic slowdown and other disruptive factors, the US and UK housing markets are also expected to experience a significant cooling.
According to data released by CoreLogic on January 2, average house prices in Australia fell by nearly 4.8% in 2018, the biggest drop since the 2008 financial crisis. In the two largest state capitals, Sydney and Melbourne, which account for 60% and 40% of Australia’s turnover, fell 8.9% and 7% respectively in 2018. Compared with their peak in 2017, house prices fell 11.1 per cent and 7.2 per cent respectively, and Sydney’s decline since its peak has exceeded the 9.6 per cent decline in house prices from peak to trough during the 1989-1991 recession. In addition, in December, the liquidation rate of Australian housing auctions was below 50% for several weeks in a row, which means that the transaction volume is low and sends out a clear sign of weakness.
Tim Lawless, head of research at CoreLogic, said the credit tightening measures of the Australian Financial Regulatory Authority (APRA) were one of the important reasons for the decline and that “financing difficulties” could remain one of the biggest obstacles to the improvement of the Australian real estate market in 2019. There are also analysts said that the decline in overseas buyers, the increase in loan interest rates, the increase in housing supply, market concerns about house prices continue to fall and other factors have exerted downward pressure on house prices.
Analysts believe that although Australian regulators recently announced the relaxation of restrictions, the Australian real estate market will continue to be weak in 2019. Judging from historical data, it often takes several years for Australian house prices to return to cyclical peaks after a sharp fall; Australian house prices are likely to continue to decline for some time to come.
Economists believe that the continued downturn in the real estate market will have a negative impact on the economy. Lawless said the negative impact of this fall in the housing market could be more severe than during the financial crisis because there is little room for federal stimulus. “now that the RBA has kept its benchmark interest rate low at 1.5% for 28 months in a row, there is little room to stimulate the economy by cutting interest rates.” In addition, Lawless also pointed out that the federal government will hold a general election in May, and some tax policies are expected to be adjusted, when the real estate market will be under further pressure.
Louis Christopher, director of real estate research at SQM, a Sydney-based real estate analyst, said the transaction data showed that the Australian real estate market was likely to move towards a “collapse” track. Torsten Slok, chief international economist of Deutsche Bank, has made a list of 30 global market risks that investors need to pay attention to in 2019, including the “collapse” of house prices in Australia and Canada.
