Today’s ABS score of the average established house in the state capitals jumping 5.2 per cent in the December quarter and 13.6 per cent over 2009 will do as an illustration. And remember that the best of the first-home buyer incentives were already washing out of the market in the December period. Annualise that December quarter figure if you dare.
Perversely, it’s the promise of a housing bubble that is sucking investors back into the market as well as panicking would-be owner-occupiers into taking the plunge. And it’s the reality of a housing bubble that will help force up interest rates.
It’s not only Crikey that’s claiming a looming housing bubble. Here Michael Pascoe argues that the three major property monitors all show an over-heated market. And that will lead to interest rate increases.
The question is, what advice are you giving to buyers and sellers?
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