Philip Lowe, Governor of Reserve Bank of Australia (RBA), recently highlighted growth in the country’s employment and a decline in its unemployment rate to 6.4 per cent. He also stated that Australia’s post-COVID economic recovery is expected to continue and the GDP is expected to grow by 3.5 per cent over 2021 and 2022.
Ray Ellis, CEO, First National Real Estate believes that demand for new homes across the cities and regions will continue to grow.
“Lifestyle and work-related changes during and post-COVID have created new requirements. Now Australians prefer homes with offices and backyards, which is boosting demand in regional areas too,” he told SBS Gujarati.
Houses in newly built suburb in New South Wales. Source: AAP
“Almost all state governments are providing incentives to home buyers. The interest rate is at a record low and the economy is getting back on track. Demand and prices of homes in the country will continue to surge for at least 12 to 24 months,” Mr Ellis added.
According to realestate.com.au, the auction clearance rate for the week ending 7 March has been higher than usual.
Three states including New South Wales, South Australia and the ACT recorded a clearance rate of more than 90 per cent, whereas, Victoria, Western Australia and Queensland saw rates as high as 86, 75 and 78 per cent respectively.
Mrugesh Soni, Wealth Advisor of Soniez Group, attributes the surge in demand and prices to several factors.
“People were able to save money over the last year due to COVID-related restrictions. Earlier After last year’s spell of unemployment, employment is now rising again. In addition, state and federal governments are running a range of schemes to keep the economy afloat. All these factors contribute towards boosting the demand for houses,” he told SBS Gujarati.
(From Left) Mrugesh Soni, Hanna Shah and Ray Ellis expect housing demand to remain on the rise. Source: Supplied by Mrugesh Soni, Hanna Shah, Ray Ellis
He expects the demand to remain strong for next 12 to 18 months.
“It depends upon when the RBA changes interest rates. That will determine the direction of the real estate market in the future,” he adds.
Data from market research company, CoreLogic, reveals that the month-on-month aggregate rise in prices of all dwellings in five capital cities is 2.06 per cent. The cities include Sydney, Melbourne, Brisbane including Gold Coast, Adelaide and Perth.
Apart from houses, the demand for land is also on the rise.
Hanna Shah, a Melbourne-based land-and-home package salesperson, says that in one year, she has seen an increase of 20 per cent in enquiries from buyers keen on land blocks.
“The prices for land are also going up. We expect our sales to record an increase of up to 40 blocks a month this year compared with 20 to 30 in the last few years,” says Ms Shah.
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