RESIDENTIAL PROPERTY
THE stabilisation in global housing prices may be fleeting, with real house prices across the G7 forecast to fall by 6% in 2023 and 3% in 2024.
According to a recent report by Oxford Economics, global house price stabilisation is unlikely to last, with major stabilising forces fading and...
In Australia—as well as the UK and New Zealand—the full impact of rising short-term rates still hasn’t been seen, with a significant portion of...
Globally, after eight months of declines, there were small gains over February to April leading to optimistic outlooks of...
“Why do we think this? One reason is simply that it is not unusual for house price corrections to be interrupted by pauses or...
Additionally, global prices have already returned to declines in key markets over April-May, after posting minor rises in April...
The key factors that led to a period of recovery are already wearing off, with mortgage rates rising again...
For example, US 30-year fixed rates have grown by 70 basis points since early February, back to more than 7%...
The pickup in house prices in February-April was probably also linked to an easing of the pace of credit restriction by banks. But again, this effect is...
“The Dallas Fed survey of banks’ mortgage credit standards improved in the early part of 2023 but has worsened again since, with a net 17% of...
Valuations are also indicating further house price declines, with world GDP-weighted real house price levels when compared to their long-term filtered trend...
“Similarly, if we compare our measure of the global price-rent ratio (based on OECD data) with its filtered long-term average, this measure remains around...
“Nor is it obvious that once prices hit fair value that they will settle there: in previous house price cycles, prices have often undershot fair...
Positively, so far banks have tightened credit conditions for mortgages far less sharply than during the GFC...
Unemployment has also broadly held up, where over the past 60 years the labour market has fallen in line with global house price declines...
“Indeed, a key reason our baseline forecasts for global house prices look for more price declines this year and next is our expectation that...
“Although the forecast increases in joblessness are relatively moderate compared to previous cycles, they will be enough in combination with...