A new report from CoreLogic and Moody’s Analytics paints a picture of recovery and modest growth for the East Coast capitals in 2020.

The report predicts that the Australian property market will trough this quarter following two years of decline, with greater falls in house prices (-11% down from the mid-2017 peak) compared to apartment prices (almost -7% down from the peak).

The CoreLogic-Moody’s Analytics Australia Home Value Index Forecast, released in late June, expects a return to gradual growth in 2020, powered by interest rate cuts and some relaxation in lending rules recently announced by APRA. 

Moody’s Analytics has developed an econometric model that enables price predictions for individual regions within a city. So, let’s take a look at what they predict for the three East Coast capitals overall and within their main precincts.

1. Sydney

Moody’s says Sydney’s correction is on track to be the longest and steepest on record but at the end of the day, house prices are still around +60% higher than they were in 2012.

Sydney’s house values declined -5.5% in 2018 and are forecast to fall a further -9.6% in 2019, before a +3.1% bounceback in 2020 and +4.8% in 2021.

Apartment values dropped -3.1% in 2018 and are set to decline by -7.3% for 2019, before a +4% rise in 2020 and +6% in 2021.

House prices

-        Baulkham Hills/Hawkesbury +6.6% in 2020, +8.7% in 2021

-        Blacktown +6.2% in 2020, +7.3% in 2021

-        City & Inner South +7.8% in 2020, +2.2% in 2021

-        Eastern Suburbs -2.1% in 2020, +0.5% in 2021

-        Inner South West +0.9% in 2020, +5.7% in 2021

-        Inner West +3.8% in 2020, -0.2% in 2021

-        North Sydney-Hornsby -0.4% in 2020, +1.6% in 2021

-        Northern Beaches +2.6% in 2020, +8.2% in 2021

-        Outer South West +2.3% in 2020, +5.8% in 2021

-        Parramatta +3.2% in 2020, +5% in 2021

-        Ryde +1.1% in 2020, +7% in 2021

-        South-West +3.7% in 2020, +4.7% in 2021

-        Sutherland +6.5% in 2020, +9.4% in 2021

-        Outer West/Blue Mountains +1.7% in 2020, +3.7% in 2021

-        Central Coast +4.1% in 2020, +5.5% in 2021

Apartment prices

-        Baulkham Hills/Hawkesbury +3.5% in 2020, +6% in 2021

-        Blacktown +3.6% in 2020, +5.8% in 2021

-        City & Inner South +3. % in 2020, +3% in 2021

-        Eastern Suburbs -2.7% in 2020, -3.5% in 2021

-        Inner South West +2.4% in 2020, +5.6% in 2021

-        Inner West +5.9% in 2020, +7.7% in 2021

-        North Sydney-Hornsby -1.1% in 2020, +0.9% in 2021

-        Northern Beaches +6.6% in 2020, +4.2% in 2021

-        Outer South West +5% in 2020, +9% in 2021

-        Parramatta +6.6% in 2020, +7.9% in 2021

-        Ryde +2.2% in 2020, +5.1% in 2021

-        South-West +5.5% in 2020, +7.7% in 2021

-        Sutherland +2.1% in 2020, +4% in 2021

-        Outer West/Blue Mountains +1.9% in 2020, +7.1% in 2021

-        Central Coast +13.1% in 2020, +13.8% in 2021

2. Melbourne

Melbourne house values are -14% below their peak after an 18-month decline. The fall in values has been most pronounced in the inner suburbs but the worst appears to be over already with a modest recovery expected in 2020.

Melbourne’s house values declined -0.3% in 2018 followed by a sharp fall this year projected to total -10.8%. The recovery will begin very slowly in 2020 with just a +1.3% increase followed by a better result in 2021 at +6%.

The decline in apartment values has been less pronounced with a +1.8% gain in 2018 and a decline this year projected at -3.9%. There will be a further decline in 2020 at -0.3% followed by a +1% improvement in 2021.   

House prices

-        Inner Melbourne +1.3% in 2020, +3.4% in 2021

-        Inner East +5.5% in 2020, +7.7% in 2021

-        Inner South -0.8% in 2020, +6.7% in 2021

-        North East +6.2% in 2020, +11.8% in 2021

-        North West 0% in 2020, +4.3% in 2021

-        Outer East -1.9% in 2020, +8.1% in 2021

-        South East +0.8% in 2020, +5.5% in 2021

-        West -0.6% in 2020, +2.8% in 2021

-        Mornington Peninsula +2.5% in 2020, +5.2% in 2021

Apartment prices

-        Inner Melbourne +4.2% in 2020, +3.8% in 2021

-        Inner East  +6.8% in 2020, +9.8% in 2021

-        Inner South -0.1% in 2020, +0.2% in 2021

-        North East +1.4% in 2020, +3.7% in 2021

-        North West +5.2% in 2020, +4.3% in 2021

-        Outer East +0.3% in 2020, +3.8% in 2021

-        South East -6.1% in 2020, -2.5% in 2021

-        West -6% in 2020, -7.1% in 2021

-        Mornington Peninsula -0.5% in 2020, +3.1% in 2021

3. Brisbane

Brisbane experienced strong growth between 2012-2018 and corrected this year. House prices went up +1.5% in 2018 but lost those gains and will lose a bit more this year for a total projected decline of -1.8%. The years ahead look a bit better with +1.4% growth in 2020 and +2.9% in 2021.

Apartment values dipped -1% in 2018 and will finish 2019 down about -0.7%. The future looks much brighter with predictions of +5.6% growth in 2020 and +5.8% in 2021.

House prices

-        Brisbane East +1% in 2020, +1.2% in 2021

-        Brisbane North +1.4% in 2020, +0.4% in 2021

-        Brisbane South -0.8% in 2020, +2% in 2021

-        Brisbane West +1.5% in 2020, +4.2% in 2021

-        Brisbane Inner City +2% in 2020, +1.9% in 2021

Apartment prices

-        Brisbane East +3.3% in 2020, +3.7% in 2021

-        Brisbane North +5.3% in 2020, +5% in 2021

-        Brisbane South +4.1% in 2020, +5% in 2021

-        Brisbane West +4.6% in 2020, +3.6% in 2021

-        Brisbane Inner City +3.9% in 2020, +5.4% in 2021 

Source: CoreLogic-Moody’s Analytics Australia Home Value Index Forecast, Second-Quarter 2019 Housing Forecast Report, published June 25, 2019

If you’re a buyer hoping to take advantage of the bottom and buy as low as possible, now is the time in most city markets. Start preparing for Spring now when we should see a seasonal pick-up in stock for sale.