Well, the evidence is in. CoreLogic’s October 2023 Home Value Index (HVI) shows an increase in property purchase prices of 0.8 percent for the past month, totalling an increase of 6.6 percent since the lowest price point registered in January 2023.
CoreLogic is forecasting prices will reach a new peak by the end of November 2023, meaning prices are projected to be higher than the peak of April 2022.
Data = true or false?
There’s a couple of key points to consider when looking at the CoreLogic HVI. The first is that it includes both houses and units and lumps all properties into one national basket. They do break down the Index into state / territory levels showing Sydney, Melbourne, Brisbane, Adelaide and Perth on upward trends, while Hobart, Darwin and Canberra are trending downwards.
Secondly, the information is based on registered sales – basically what people paid for their properties at least six to eight weeks ago. So their forecast for a continued increase is based on trends and other ‘unspecified’ data.
Economists forecast
One of the more reliable forecasts for price direction was released at the end of September 2023 from KPMG, who point to an increase nationally of 4.9 percent over the next nine months, then a spike by 9.4 percent in the year to June 2025.
KPMG point to the issue of constrained supply coupled with high demand from increased migration as the basis for continued price strength, along with continued increases in rent growth. KPMG state dwelling completions would need to jump by 76 percent over the current planned number of completions before property prices and rents would start to ease.
What does this mean for you?
In a nutshell, we’re looking at a period of continued overall market strength. However, while performance tracking and forecasts are ‘useful’ at national and state level, things are very different when you’re comparing one property to another.
This is where buyers can be tripped up and find themselves paying far too much for a property, or they jump on what seems like a bargain but the property ends up delivering a nasty surprise.
While there’s a delicate balancing act required when buying in any market, you don’t have to do it all alone. If you have your eye on a property (or two) that you’re keen to purchase and want to be absolutely sure you’re going to get the best possible deal, then check out our new service ‘Negotiation Navigator’.
Negotiation Navigator is designed to help people who want to do their own searches, and just want some help with the pivotal part of negotiating with an agent or participating in an auction. Check out more details about the service here.
About the author
Debra Beck-Mewing is the Editor of the Property Portfolio Magazine and CEO of The Property Frontline. She has more than 20 years’ experience in buying property Australia-wide and has extensive experience in helping buyers use a range of strategies including renovating, granny flats, sub-division and development. Debra is a skilled property strategist, and a master in identifying tailored opportunities, homes and sourcing properties that have multiple uses. She is a Qualified Property Investment Advisor, licensed real estate agent and also holds a Bachelor of Commerce and Master of Business. As a passionate advocate for increasing transparency in the property and wealth industries, Debra is a popular speaker on these topics. She is also an author, podcast host, and participates on numerous committees including the Property Owners’ Association.
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Disclaimer – This information is of a general nature only and does not constitute professional advice. We strongly recommend you seek your own professional advice in relation to your particular circumstances.
