Aus, real estate prices will increase by 16%: Fitch

The rating agency Fitch has raised its forecast for housing prices in Australia, predicting that prices will rise by up to 16% in 2021.

The rating agency has raised its home price expectations for seven countries in 2021, with the biggest revisions coming to Canada and Australia. Both countries were marked by double-digit price growth forecasts.

Low mortgage rates, prolonged support for the pandemic and faster economic rebounds are expected to lead to an increase of 14-16% in Australia for 2021.

Lockdowns, border closures and working from home have also resulted in increased savings, allowing shoppers to save for door-to-door deposits sooner than expected.

Additionally, with the cash rate at an all-time low of 0.1 percent and the RBA’s term financing facility means that “low-cost mortgage credit is readily available to most buyers,” noted Fitch.

“Low interest rates in Australia have also started to encourage real estate investors into the market, potentially replacing first-time homebuyers’ demand as they begin to be valued,” the report says.

However, government support for buying a first home has further encouraged buying. Fitch noted that data from the Australian Bureau of Statistics showed first-time homebuyers taking up about a quarter of total loans in March, up from around 10% four years ago.

The trend towards remote and hybrid working has led to a move away from capital cities, according to the report. House prices had risen in almost all parts of Australia and in three other countries monitored: Canada, the United States and Ireland.

Canada is expected to experience a 10-15% increase in 2021, while the United States is expected to experience growth of 8-10%, Ireland is expected to experience a 4-6% increase and an increase of 6-10% . was called for Denmark.

Fitch said the surge in house prices could slow in the medium term if new supply increases to meet demand.

But supply constraints are expected to persist next year, due to limited construction in Australia, where it has been limited since before the pandemic.

Fitch noted that the cost of building materials also increased in 2021, pushing up construction costs, which will be passed on to buyers via higher asking prices for future new construction.

[Related: Active property listings log biggest YOY fall on record]

Aus, real estate prices will increase by 16%: Fitch

mortgage company

Last updated: July 20, 2021

Posted: July 21, 2021

Are you a broker new to the process of growing your business? Then there’s good news: The Adviser’s New Broker Academy is back in 2021 and will provide you with essential insights on cutting-edge tools, strategies and processes to accelerate success. Don’t miss your chance to attend. To secure your FREE spot, visit newbroker.com.au now!

Sarah simpkins

Sarah simpkins

Sarah Simpkins is the managing editor of Mortgage Business and The Adviser.

Previously she reported on banking, financial services and wealth for InvestorDaily and ifa.

You can contact her on This e-mail address is protected from spam. You need JavaScript enabled to view it..

Source link

About Wanda Dufresne

Check Also

The Zurich Film Festival unveils a program that gives pride of place to Hollywood glitz

09/16/2021 – Zurich will host its festival from September 23 to October 3, aimed at …

Leave a Reply

Your email address will not be published. Required fields are marked *