Around 35 per cent of 20 economists and experts believe that property prices would rise by 10 per cent by 2020, while 30 per cent of the respondents expects a more conservative increase of close to five per cent.
“It’s typical of the cyclical nature of the property market,” said Finder spokeswoman Bessie Hassan. “In fact, a 5 to 10 per cent increase is somewhat conservative—it’s a common belief that property value doubles every seven to 10 years.”
Hassan also pointed out that the current drop in prices could only be an indication that the market is entering a correction phase.
“While there was concern about a ‘housing bubble’ or unsustained growth for some time, we’ve now seen a correction phase where the property market has softened yet is likely to go up again in the future,” she said.
However, two experts also predicted an upcoming fall in prices, owing to the huge wave of supply coming into the market because of the construction boom, especially in Brisbane.
“Foreign investment rules can also exacerbate the amplitude of a downturn,” said Stephen Koukoulas of Marketing Economics. “Then you throw in the cyclical elements, investor lending being tightened, and the weak growth in rental yield that make investing in property harder to justify when you’re getting a dismal rent yield.”
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