I have been predicting for the past few months that 2020 will see a major rebound in the Australian property market.
This prediction has been confirmed by the latest research by the highly respected SQM Research that is also forecasting a major recovery in property values.
Overall, their research indicates that national dwelling values could rise between 7 per cent to 11 per cent next year.
The company also predicts that Sydney and Melbourne dwelling prices will drive the nation's housing market bounce back next year.
SQM Research forecast that Sydney property values could rise between 10 to 14 per cent and Melbourne property values by 11 to 15 per cent over 2020.
Significantly, their research also indicates that property markets in other major cities will also see an improvement in property values next year.
For example, they are predicting that dwelling values in both Perth and Brisbane to rise between 3 and 6 per cent during 2020.
This positive outlook for the Australian property market has been further underlined by the new research undertaken by the ANZ and Corelogic.
It shows that housing affordability peaked in June, with forecasts property prices could reach record highs in the first half of 2020 if they continue at current rates.
National dwelling values were 6.5 times higher than gross annual household incomes in June, the lowest level since December 2013, according to ANZ and Corelogic.
There a growing expectation that the RBA will again cut interest rates in response to poor employment figures for October 2019.
Australia's unemployment rate jumped back to 5.3 per cent during October with the number of jobs falling by 19,000 over the month.
Concerns about a weakening job market has seen the RBA cut interest rates three times during 2019 and further interest rate cuts during 2020 will only benefit the property market.
DEPPRO is predicting that further cuts to interest rates in 2020 will encourage more people to enter the property investment market.
In particular, we expect more activity from mature property investors who have seen the returns on their cashing savings diminish due to falling interest rates.
These mature property investors are generally on high incomes and can use generous tax benefits associated with property investment such as depreciation to boost their cash flow so they can purchase investment properties that will help fund their retirement.
By Paul Bennion, Managing Director, DEPPRO