In this show, we examine the main reasons why it is likely property prices will fall next year – this is a counterpoint to my earlier show which went through the Five reasons why they will rise – as trotted out by the property spruikers.
In summary, the risks from higher unemployment or a recession, the exit of property investors, higher delinquency and defaults, higher mortgage rates for longer, and dire housing affordability are all reasons why prices could fall in 2024.
And let’s be clear, the great Australian dream of owning a home is now totally out of reach, and many who were pulled into the market in recent years are in strife, to the point where rental costs have gone though the roof, and tent cities are becoming a thing. The very soul of Australia is decaying, unfortunately, that is unless you are fortunate enough to have family wealth or an existing property portfolio, which could now potentially fall in value.
Of course, the actual trajectory of home prices will vary across states, locations and types of property, and averages mask important differences. Which is why in our modelling we go granular – to a post code level, and also consider various scenarios based of the relative weightings of the positive drivers to prices we discussed yesterday, and the downward drivers we looked at today. So the answer is: it depends.
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Today’s post is brought to you by Ribbon Property Consultants.
