TARYN PARISMON 15 FEB 21
The CBA is forecasting a surge in house prices over the next two years of up to 16 per cent, while unit price-growth will be more muted at 9 per cent.
According to the CBA, lending rates have lifted sharply, signalling a housing market on the “cusp of a boom”.
“The increase in new lending is now feeding into higher prices for bricks and mortar,” CBA economist Gareth Aird said.
“The negative impact that Covid-19 had on Australian property prices turned out to be much more muted than almost any forecaster expected, us included.
“…rapid growth in new lending over the second half of 2020 was stronger than we anticipated.”
^Source: CBA
In its most recent economics issues report, released today, economists at the CBA reported the boom was off the back of record low interest rates and a v-shaped labour market recovery.
The CBA is reporting positive momentum is building within the property market and “as the market firms, would-be buyers are more confident to purchase and this brings other buyers into the market”.
The news is less positive for unit-owners. CBA is forecasting a disparity in price growth between houses and apartments.
“We forecast national house prices to rise by 16 per cent over the next two years and unit prices to rise by 9 per cent,” Aird said.