Economists and others who don’t understand real estate appear to be competing to be the first to declare the end of the boom.
Some commentators are seizing on every tiny scrap of data to justify a claim that the market has peaked or that the boom is over.
Recently a slight drop in auction clearance rates was held up as evidence that the frenzy was over. Others claimed that because property prices rose “only” 2% in April (according to one source), this was proof that the boom was finished.
The reality is that, for many locations around Australia, the up-cycle is only just getting started. It’s being driven by multiple influences – I have 16 dot points on my list of factors driving it – and won’t come to a halt any time soon.
Some of elements have yet to kick in, such as a massive infrastructure spend around the nation, the impact of investors belatedly joining the market and the eventual re-opening of international borders.
While the intensity may ease a little, the phenomenon of sales volumes and prices rising will extend well into next year.
Terry Ryder June 2021