Sydney to lead Asia-Pacific region with six per cent real estate value growth in 2020: Savills
Sydney is predicted to lead the Asia-Pacific region with more than six per cent capital value growth in 2020, according to Savills Global prime residential forecasts 2020.
Lisbon and Moscow are the only other capitals across the globe to be forecast to see over six per cent gains.
Sydney's growth predicted was attributed to lower interest rates, increasing immigration and continued increase in demand.
Savills did advise however the market remains sensitive to global uncertainty and price rises could be reactive to any fluctuations in the market.
They said the ongoing bush fires may be a near-term mitigating factor for the market as they start to impact on national GDP growth, however it isn't expected to weaken capital city price growth for middle- to upper-priced detached housing or market sentiment. They suggest it will continue to impede growth in rural areas
Paul Craig, chief executive of Savills Australia and New Zealand, said the Australian residential market is reverting upwards fuelled by lower mortgage rates and unfulfilled demand.
“At 31 Aug 2019 CoreLogic’s National price change was -5.2%yoy, at 30 Nov 2019 the National price change had improved to +0.1%yoy. Sydney (was -6.9%yoy) improved to +1.6% and Melbourne (was -6.2%yoy) improved to +2.2%yo", Craig said.
Prime residential forecasts 2020 and prime capital value price growth 2019
City | 2020 growth forecast | Capital value growth 2019 | £/psf | $/psf | €/psm |
Lisbon* | 6% to 7.9% | - | £700 | $920 | € 8,900 |
6% to 7.9% | 1.7% | £1,270 | $1,670 | € 16,100 | |
Moscow | 6% to 7.9% | 2.3% | £980 | $1,280 | € 12,400 |
Paris | 4% to 5.9% | 6.4% | £1,210 | $1,590 | € 15,400 |
Amsterdam* | 4% to 5.9% | - | £710 | $930 | € 8,900 |
Guangzhou | 4% to 5.9% | 0.5% | £890 | $1,170 | € 11,300 |
Hangzhou | 4% to 5.9% | 4.8% | £750 | $980 | € 9,500 |
Berlin | 2% to 3.9% | 8.8% | £760 | $990 | € 9,600 |
Singapore | 2% to 3.9% | -0.2% | £1,200 | $1,580 | € 15,300 |
London | 2% to 3.9% | -1.5% | £1,460 | $1,920 | € 18,500 |
Cape Town | 2% to 3.9% | -6.3% | £230 | $310 | € 3,000 |
Shanghai | 2% to 3.9% | 3.3% | £1,340 | $1,760 | € 17,000 |
Tokyo | 0% to 1.9% | 1.9% | £1,650 | $2,160 | € 21,000 |
Los Angeles | 0% to 1.9% | -2.8% | £1,050 | $1,370 | € 13,200 |
Geneva* | 0% to 1.9% | - | £1,470 | $1,930 | € 18,700 |
Beijing | 0% to 1.9% | 0.9% | £1,090 | $1,440 | € 13,900 |
Shenzhen | 0% to 1.9% | 1.9% | £1,130 | $1,480 | € 14,300 |
San Francisco | 0% to 1.9% | -3.2% | £1,180 | $1,550 | € 15,100 |
Madrid | 0% | 0.6% | £550 | $720 | € 7,000 |
Barcelona | 0% | 0.7% | £490 | $650 | € 6,200 |
Bangkok | 0% | -1.0% | £670 | $880 | € 8,600 |
-1.9% to 0% | -5.4% | £730 | $960 | € 9,300 | |
Mumbai* | -1.9% to 0% | - | £980 | $1,290 | € 12,500 |
Kuala Lumpur | -1.9% to 0% | -1.0% | £210 | $280 | € 2,700 |
New York | -1.9% to 0% | -3.0% | £1,910 | $2,510 | € 24,300 |
Dubai | -2% to -3.9% | -5.8% | £440 | $580 | € 5,600 |
Hong Kong | -6% to -7.9% | -1.5% | £3,510 | $4,610 | € 44,700
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“The RBA and APRA will become concerned as house prices approach 2017 highs (expected in May 2020) and we could see the reapplication of macro-prudential measures to curb house prices and address affordability issues.”
Savills Australia's director of residential Chris Orr said luxury property in Sydney’s key markets have definitely bounced back.
“Sydney overall has recovered anywhere from 5-7% in blue-chip areas however there are still some local markets where there is an oversupply of apartments which has negatively impacted prices", Orr said.
“Australia as a whole, is considered a growth market at the moment given our recent financial regulations having changed for the better and new re-elected Government which is focussed on maintaining a secure economy."
