Well, this rain delay is really dampening our spirits for some good cricket to be played in the second test, so. . . . with all the (lucky!) Aussies in England cheering on our boys – it got me thinking about population growth and what it means for house prices. (Along with Warner showing the English crowd he has empty pockets in the first Test!)
The Reserve Bank Governor Dr Philip Lowe is a member of the Standing Committee on Economics along with:
- Ms Michele Bullock, Assistant Governor (Financial System), Reserve Bank of Australia
- Dr Guy Debelle, Deputy Governor, Reserve Bank of Australia
- Dr Luci Ellis, Assistant Governor (Economic), Reserve Bank of Australia
Well, they met last Friday 9th August and if the rain is still coming down in London and you can’t get to sleep, you can flick through the 40+ pages along with 26,000+ words to see what they got through discussing:
Standing Committee on Economics – 09/08/2019 | Reserve Bank of Australia annual report 2018
Buried in there, you will see reference to the cash rate falling from 4.75%, to the 1.5% that it is now. To paraphrase Dr Lowe, he confirms that lower interest rates have pushed up housing prices fairly clearly.
However, in his view, the population growth pickup that we had in Australia over the last decade, took the most part of the decade, for the rate of growth of the supply to respond to the population growth. Further to that, really importantly, for the next cycle of the housing market, he noted that there is still quite strong population growth, but due to market conditions, the supply of housing stock is slowing right down.
This is because developers are struggling to get finance, the supply of housing is therefore slowing down a lot and the seeds are being sown for the next upswing.
So, if you haven’t got your copy of our Property Clock report showing where your city sits on the clock, be sure to hit enquiries@propertyclub.com.au for a free copy of this detailed report to see the best places to invest in, to take advantage of this upcoming upswing!
Troy Gunasekera | National Manager