Taylor Scott International News
Property price growth in Sydney and Melbourne is expected to slow in 2016 as prices have peaked, according to an outlook report from the Housing Industry Association (HIA). It points out that as of November pries had increased in Sydney by 12.8% year on year and in Melbourne by 11.8% year on year. Then there was a huge gap to Brisbane where prices increased by 4% year on year. ‘The aggregate price cycle, heavily masked by Sydney and Melbourne, will continue to experience decelerating growth. Sydney and Melbourne are the two biggest markets and it is appropriate that price growth is slowing,’ the HIA report says. It points out that variable mortgage rates are on the rise and this is likely to dampen price growth. Overall the market was busy in 2015 for residential construction with new home commencements reaching a record high of nearly 212,000 in 2014/2015 and are forecast to exceed 200,000 in 2015/2016. ‘If we can progress right through 2016 with commencements holding up at an annualised level above 180, 000, and we forecast that will happen, that outcome should be regarded as a healthy one,’ the report explains. Indeed, new dwelling commencements increased for a third consecutive year in 2014/2015, only the fifth time in the past 60 years that housing starts have seen three straight years of growth. The record level of nearly 212,000 starts is 13% than the previous high of 187,000 in 1994. It adds that new home building is set for another healthy year ahead. Taylor Scott International
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