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How much will prices grow in 2015? SQM Research’s national predictions
Topic Started: 17 Sep 2014, 09:33 PM (4,381 Views)
peter fraser
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How much will prices grow in 2015? SQM Research’s national predictions
Jennifer Duke | 17 September 2014
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SQM Research’s latest Housing Boom and Bust Report forecasts growth to continue across the housing markets for the rest of this year, and far into 2015, with interest rates the key factor to watch.

Louis Christopher, managing director of SQM Research, said that the housing boom is not yet over and has provided strong forecasts for most of the capitals.

It seems that rates are one of the major factors to watch, substantially altering the forecasts should rates remain unchanged when compared to potential increases.

“The market is somewhat overvalued but not by as much as what some have very publicly stated. I don’t believe at this stage the market is in a bubble. Some cities are heading into overvalued territory, but the point overall is the market is far from a bubble situation when taking into account historical valuations over the past 30 years,” said Christopher.

There are certain scenarios he took into account for each forecast for 2015.
1 Scenario 1: Base case. Rates remain unchanged. Economy steady, AUD above 85 cents.
2 Scenario 2: A 0.25 cut in rates in first quarter of 2015.
3 Scenario 3: A 0.25 rise in mid- to late-2015.
4 Scenario 4: Macro prudential tools employed at the beginning of the year. Rates cut towards end of 2015.

Note that the 12 months to June 2014 results are from the ABS Cat 6416. The 2014 forecast figures were from the SQM Research September 2013 Housing Boom and Bust report.

The entire report is available for purchase via SQM Research.
Scenario 1
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Scenario 2
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Scenario 3
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Scenario 4
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Edited by peter fraser, 18 Sep 2014, 11:23 AM.
Any expressed market opinion is my own and is not to be taken as financial advice
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Jimbo
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Perth, none of the above.

Matthew, 30 Jan 2016, 09:21 AM Your simplistic view is so flawed it is not worth debating. The current oversupply will be swallowed in 12 months. By the time dumb shits like you realise this prices will already be :?: rising.
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peter fraser
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More from ANZ - http://www.propertyobserver.com.au/forward-planning/investment-strategy/market-trends/35746-further-gains-tipped-for-sydney-and-melbourne-anz.html
Jimbo
17 Sep 2014, 09:41 PM
Perth, none of the above.

Perth - 1% to 4%

Mike will be OK with that.
Edited by peter fraser, 17 Sep 2014, 09:52 PM.
Any expressed market opinion is my own and is not to be taken as financial advice
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Mike
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peter fraser
17 Sep 2014, 09:50 PM
That has been my prediction for 2 years now. I expect the market to slow in 2015 and remain flat or slow growth for a number of years.
http://mike-globaleconomy.blogspot.com.au/
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Foxy
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Zero is coming...

Please adjust for inflation.
Peter
http://www.afr.com/content/dam/images/g/n/2/1/u/8/image.imgtype.afrArticleInline.620x0.png/1456285515560.png
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goldbug
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Please adjust for the myriad of prissed up inner city homes where people spend hundreds of thousands before reselling them.
Shadow was hopelessly wrong about the Gold Bull Market.
What else is he wrong about?
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Sydneyite
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goldbug
18 Sep 2014, 10:23 AM
Please adjust for the myriad of prissed up inner city homes where people spend hundreds of thousands before reselling them.
*Why* do you think people spend sometimes spend that money? Do you understand the process of gentrification of inner city suburbs in places like Melbourne and Sydney? And the impact this has on an areas property values in general?

Hint - if there was no market for doing it, or yours was the only prissed up house in a suburb otherwise full of bogans, it would be called "over-capitalisation" - but there is a market, because people with $$$ are prepared to pay, hence values rise. It's as much a part of the property appreciation cycle as anything else, so I don't know why you would discount it?

EDIT: I've "prissed-up" and inner city home in the past - I spent 20% what I paid for it in reno's ($100k/$500k), but got double the price paid when I sold it ($1M). If it was still un-renovated when I sold I reckon I would have on;y got $850k for it. So I think the value rose by more than the amount spent, don't you? Plus the reno added more value again.
Edited by Sydneyite, 18 Sep 2014, 10:32 AM.
For Aussie property bears, "denial", is not just a long river in North Africa.....
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Fisho74
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So when will price growth flow out into regional areas such as the fraser coast etc.? Prices around Hervey bay & the likes are at 2004 prices. Will people see the value in these very affordable areas. Coastal suburbs have alot to catch up to capital cities. Sydney & melbourne have to be losing their shine for investors surely..
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Elastic
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Fisho74
18 Sep 2014, 11:57 AM
So when will price growth flow out into regional areas such as the fraser coast etc.? Prices around Hervey bay & the likes are at 2004 prices. Will people see the value in these very affordable areas. Coastal suburbs have alot to catch up to capital cities. Sydney & melbourne have to be losing their shine for investors surely..
The current boom is driven by investors and some foreign buying predominantly in Sydney and Melbourne.
That is where the population growth is.
I always respect SQM's information but I am curious to know whether Louis expects investor demand to continue at similar levels all through the next year.
Edited by Elastic, 18 Sep 2014, 12:22 PM.
Only a rat can win a rat race.

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Perthite
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peter fraser
17 Sep 2014, 09:50 PM
Peter it seems property experts in Perth are shying away from predictions.

Perhaps they don't like what they see.
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