Australian Housing Market to Continue Growing Into 2021: Reuters Poll
According to a recent Reuters poll, recent rate cuts by the RBA are expected to support the recovery of the Australian housing market into 2020 and even 2021 as well. Average house prices are expected to climb 5% higher in 2020 and grow by slightly lesser at 4.5% into 2021.
60% of the economists polled indicate that any additional rate cut by the RBA to bring down the benchmark rate to 0.75% would prove even more beneficial to the housing market, helping activity and prices register an uptick. They expect mortgage rates to stay low for some time to come, which will encourage more consumers to consider spending on buying homes.
However, economists have cautioned that low wage growth and weak consumer sentiment could deter growth in the housing market. Latest economic data suggests that the RBA’s monetary easing has yet to have a positive impact on consumer sentiment, keeping buyers hesitant from making big purchases so far.
Markets are widely expecting the RBA to ease its monetary policy further at least one more time next year as it attempts to revive the weakening Australian economy. Australia’s trade reliant economy has suffered severely on account of the US-China trade war over the past few months.
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