The 2022 federal election: What to expect for housing affordability
Unless a structural change to the Australian economy takes effect, greater housing affordability is not likely to happen...
According to Mike Mortlock, managing director of MCG Quantity Surveyors, while 2022 will likely bring growth in positive territory, Australia won’t be experiencing the same fever pitch come December 2022 as has been seen throughout 2021.
“A lot depends on macroprudential policies, but with affordability constraints and listings increasing, a slowdown seems obvious,” Mr Mortlock said.
To monitor the changes in the market over the coming months, he’s keeping his eye on one primary measurement: the number of listings.
“Listing volumes are the key metric for me. We saw listing numbers very low due to early stage pandemic fear, then they stayed low as vendors faced the issue of finding another home within such a hot market,” he noted of the supply struggles in 2021.
“As the market calms down, more listings should come on, tipping the buyers versus sellers balance a little closer to centre,” Mr Mortlock predicted.
That might come at a price for some buyers who felt pressured to strike out of fear they’d otherwise be left behind.
“Towards the back end of 2021 we saw a lot of properties transacting that would tend to languish on the market, such as units in Melbourne and Sydney. Typically, these properties have been less attractive of late but either speculators have jumped in trying to time an upswing, or these properties were just snapped up by people that have missed out so many times they’re just desperate to get into the market,” Mr Mortlock explained.
“Many of these properties could result in losses due to the competitive market and what industry people like to call FOMO,” he added, though noting he personally “can’t stand the bloody acronym”.