The spike could hit within six weeks.
Australia’s ailing housing market could soon be a thing of the past, with leading economists predicting a property market spike as soon as July.
Over the last six months, the real estate market in Australia entered a slump with house prices dropping an estimated 20% in capital cities and 10% nationally. This, coupled with 4% unemployment and regulation changes, has landed the market in the largest housing slump “in nearly forty years”, according to Macquarie Bank.
However, this slump could soon be over in a matter of months, with economists predicting that the market will bounce back by the end of the financial year.
Macquarie Bank revealed that severe periods of decline were often followed by an increase in the market.
“If you look at prior cycles, an increase in house prices occurred five to seven months after the trough in the annualised growth rate. Using the average of six months, prices could rise by July,” the Macquarie Bank equities strategy team reported.
Macquarie’s predictions also took into account relaxed lending conditions which will see more borrowers able access a mortgage, and a looming interest rate cut that could see the rate slashed to just 0.5% by 2020.
The predictions have been backed by the Commonwealth Bank with the institution revealing that it saw the highest level of home loan applications in ten months in the last week.
SEE ALSO: Big W shutdowns begin across Australia with 41 departments closed
This article is brought to you by Bendigo Bank…find your happy place.
Written by Kate Stevens
Images: Getty
