Opinion 'A': House price rises to extend into 2010: APM
"Property owners will continue to see their investment grow in the new year, with house prices already exceeding pre-global financial crisis levels nationally by nearly three per cent, and growth is expected to continue well into 2010," APM said in a statement issued on Dec 11.
Opinion 'B': House prices tipped to slide
The value of Australian homes will drop 14 per cent by the end of 2010, pushed down by a falling employment levels, according to an analysis done by JPMorgan in June. However, at that time the bank was expecting the jobless rate, sitting at 5.4 per cent at that time, to hit 9 per cent in that time. Given the latest monthly unemployment figures showed a slight decrease in the jobless rate and a pick-up in the creation of full-time jobs, it seems more likely that the unemployment rate will peak at less than 7% in this economic cycle. Anyhow, historic data doesn't support the view that house prices always fall when unemployment rises - after the last technical recession (1990/91), unemployment peaked at 10.9% in December 1992, and was over 10% for the whole of 1992 and 1993.
But house prices nationally rose by +3.3% with performance varying across capital cities. In NSW unemployment hit 11%, but Sydney house prices rose by +2.3%. In Melbourne house prices fell by -1.0% and in Brisbane they rose by over 8%.
So, depending on who you believe, Sydney house prices are set to either go up or down next year, or maybe end up unchanged. Glad that's cleared up. ;)
All I know is that the average house price in the two suburbs where we own property have gone up more than 5% in the past six months, but seem to be levelling off in recent months. I'm pencilling in a rise of 2%-7% during 2010 for our property portfolio. But it hardly matters since we don't expect to sell our rental property for at least 3 or 4 years, and we'll probably not sell our current home until we've retired in 20 or more years time.
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