Real Estate set to boom again
As predicted, the Reserve Bank cut interest rates by 0.25 percent in September, kicking off what is expected to be a prolonged period of rate reductions.
Economists had widely expected the decision, with some suggesting that as many three further cuts remain on the cards in the coming year.
Many major lenders announced they will be cutting rates on variable mortgages by 0.25 percent just minutes after the RBA decision was announced.
This news is also coming on top of predictions that Australia will face another housing boom within three years.
According to ANZ economists, Australia faces a critical and potentially chronic shortage of housing in the years ahead.
With record levels of immigration expected, the Housing Industry Association predicts a shortfall of about 18,000 dwellings in NSW over the next 12 months alone.
“A growing housing shortage is setting the scene for the ‘mother of all’ housing booms.”
It isn’t just the ANZ economists who are optimistic about Australia’s real estate market. While BIS Shrapnel expects the housing market to remain subdued over the next year, it estimates Sydney house prices will grow 18% over the next three years.
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