Dwelling price rises to ramp up in Sydney, Melbourne in 2017: SQM
Staff ReporterDecember 7, 2020
New figures from SQM Research predict an acceleration in dwelling price rises in Sydney and Melbourne for the 2017 calendar year.
SQM's Boom and Bust Report said the housing market is currently at its second most overvalued point on record, driven by a combination of factors including loose monetary policy, strong population growth and booming local economies, especially in New South Wales and Victoria.
SQM managing director Louis Christopher said the capital city average forecast is for dwelling prices to rise 6 percent to 10 percent.
"SQM Research forecasts an acceleration of dwelling price rises in Sydney and Melbourne with Sydney dwelling prices forecasted to rise 11 percent to 16 percent for the 2017 calendar year, while Melbourne is forecasted to rise by 10 percent to 15 percent," he said.
"The forecasts assume a stable interest rate environment, a stable exchange rate and no further home lending restrictions by APRA. If lending rates are cut again by the RBA, Sydney and Melbourne prices could rise by up to 18 percent for the year as forecasted by SQM’s “Scenario 2 outlook”.
"But the end of 2017 will see both Sydney and Melbourne markets dangerously overvalued, paving the way for a possible correction in 2018."