Downward pressures might push investors out
Covid-19 has made for a reduction in property listings and less sales activity and most commentators anticipate this will impact on the market.
In ANZ’s latest Property Focus report, the bank’s economists reiterate their view that the impact will be significant, with softening demand becoming clear over time and a big drop in prices.
While they note the data will be all over the place in the period covering lockdown and the easing of restrictions, they are picking a 10-15% fall in house prices over the year, compared with a fall of 8-10% in GDP.
Further, they see downside risk to their forecast as the housing market usually responds more to downturns in GDP than they have assumed and this means there is a risk of an even greater fall, they say.
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