While economists and media commentators are going out of their way to spread gloom about property prices, it appears most consumers have managed to tune out all that media white noise.
A colleague of mine describes it as “Doom Fatigue” and I think that encapsulates the public mood at the moment.
Australians are suffering from Doom Fatigue not just about the property market, but after years of the news bulletins being dominated by Covid, natural disasters and war in Europe, they just don’t want to know about it.
I believe many Australians are overwhelmed by the constant stream of sensationally negative news from the war in Ukraine, shortages and rising prices for food, energy and petrol, and various instances of murder and mayhem in the world.
People are utterly sick of being bashed with bad news and as a result they are tuning it out.
Many people I know have simply stopped watching the evening news.
And I think this phenomenon of Doom Fatigue has extended to media forecasts on property prices.
For years, it has become common for media commentators to forecast a collapse in our property prices.
There were predictions of 40% decreases in home values when the GFC struck in 2008 – but prices rose in the next two years.
When Covid first appeared in Australia early in 2020, most economists forecast that house prices would drop 15%, 20% and, in a worst-case scenario, 30% – but what we got, instead, was a nationwide property boom.
At the start of this year, some economists suggested we would have a 15% drop in our property prices because of the invasion of Ukraine.
And now the usual suspects would have us believe that prices will collapse because interest rates are rising.
A consumer sentiment survey by the comparison website Finder shows that, despite all the doomsayers’ forecasts about property prices plunging, plummeting or nosediving – to use the ridiculous language beloved by tabloid journalists – most consumers actually expect property prices to perform well.
Even in Sydney and Melbourne, where economists and commentators have declared prices to be falling already, only about 20% of consumers believe prices in their local area will fall in the next 12 months.
Brisbane consumers are the most bullish with 63% expecting prices to rise, followed by 58% in Perth, 56% in Melbourne and 50% in Sydney.
A further large percentage of those surveyed expect property prices to stay the same.
Very few expect home values to fall.
The UDIA also has released its home purchaser sentiment survey for the Greater Brisbane area.
This, too, has found that consumers are still confident about the market’s price prospects for the next 12 months.
Its survey of perceptions of the property market found 41% of people expect Brisbane property prices to continue to increase in the next six months and 40% believe that will continue for the next 12 months.
Essentially about two thirds of respondents expect Brisbane prices to grow or stay the same in the next 12 months.
So the evidence to date suggests most consumers are not believing the doomsday headlines.
Doom Fatigue has taken over and media commentators collectively have become the boy who cried “wolf!” too many times.