If Sydney house prices are to continue mirroring what the market has been already doing for the past 25 years, the capital city’s median house value could climb to $6.35m by the year 2043, according to a new CoreLogic report presented by Aussie.
It may be “hard to fathom” as the report says, but it’s also just as rooted in possibility, especially if houses are to continue riding the same pace of growth as they have over the past 25 years – at the annual nationwide rate of 6.8% per annum.
But of course, such predictions are never set in stone, and nor is the market.
“Obviously these simple extrapolations don’t take into account how economic and demographic conditions might play out over the next 25 years or how housing demand and supply may evolve; so there is a real possibility that housing trends and growth rates could look remarkably different to what we’ve seen,” the report affirms.
Whilst Melbourne’s median house value will not be as severe as Sydney’s sour-face-inducing price (which did we forget to mention also includes units soaring past the $3m mark), it could look like something close to $6m, and Brisbane’s at a somewhat softer $2.24m.
The figures come about from CoreLogic tracking market trends since 1993; back when buyers could grab a house for a median value of $111,524.
Since then, median house values shot up nationally by 412% across a quarter of a century (whilst the great Aussie dream for some of us shot down), with the report giving a firm, congratulatory nod to home owners who reaped a “significant wealth boost” as a result… whilst the rest of us discovered avo on sourdough.
In dollar terms – not that changing the formula will soften the blow – houses are now higher by $459,900, and units by $392,000 both nationwide.
The report also reflects on the rise of the seven-digit hammer throw.
“Across Australia’s highest priced capital city, Sydney, 25 years ago only 0.8% of houses sold above the $1m mark, whereas over the past year 50% of all house sales had a price tag of at least $1m,” it says, also mentioning that 25 years ago houses that sold for under $400,000 dominated across the country.
A surge of fresh market predictions has swept property news, wherein property experts have anticipated the market to take on a moderate growth phase starting June, signalling the first shift upwards. The report says CoreLogic’s forecast figures are only graphed extensions of the past, and “while the past isn’t always the best predictor of the future, it’s a worthwhile benchmark to consider where housing values may be 25 years from now”.
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