The Australian housing market is booming and Sydney, in particular, has seen a lot of growth over the last few years which is great if you’re looking to buy or sell. But how do we know whether this trend will continue?  Well, the Reserve Bank of Australia (RBA) released their quarterly report on Tuesday with predictions for house prices in Sydney and they predict that it will be an even better year than 2017.

The Sydney property market has been performing really well. The Sydney Morning Herald reported that the median house price in Australia’s most populous city increased by an average of 10% per year over the past decade, which is impressive. But what’s causing this rise in value? Read on to learn more…

Here are some reasons why the value of houses in Australia is going up:

1. Australia’s economy is strong

It’s no secret that Australia has done well over the last couple of years. The Business Insider reported that we’ve been in a period of economic growth and low unemployment since 2011, which is great for employment and home prices. Stronger economies mean higher demand for housing, which leads to an increase in property value.

2. Interest rates are low

We’re currently experiencing one of the lowest interest rate periods in recent history, with rates starting at 1% – not close to historical averages, which were closer to 6%. While this could be seen as a good thing (because it means lower monthly repayments), it can also make it harder for people to save up enough money for a deposit because there is less incentive to save. However, the RBA predicts that interest rates will remain low for some time yet which is great news if you’re looking to borrow money for a property purchase.

3. The population of Australia is increasing

Last year, over 270,000 people immigrated to Australia and this has had an impact on housing prices because there are more buyers in the market which can push up prices. If you include temporary immigrants (such as international students) the number rises even higher! As it stands, Australia’s current population growth rate is at 1% (which means we’re adding about 350 people per day). This isn’t enough to replace the amount of houses that are being demolished but it does contribute to rising house prices. There’s plenty of evidence that the population of Australia is growing and this will continue to be a factor in rising house prices.

4. There’s increased housing construction

There has been an increase in new property development across Australia, particularly in Sydney due to policies such as ‘Sydney 2030’ which aim to relax planning laws and allow for denser building around transport hubs. While this can lead to more affordable houses being built (because there is more supply), it can sometimes push up prices because of increased demand. However, the end result should be a good thing – a bigger variety of houses at different price points with plenty of choice for buyers!

Conclusion

The Value of Houses in Sydney is going up, but it’s not an easy market to navigate. To maneuver through this industry at ease, theBiownr Platform can help. It provides you with data-driven insights and precise analytics so that you can make informed decisions about your housing investments or purchases at any stage of the process – from deciding when to buy a house and what area will be most profitable for investment purposes.