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The trend is your friend – Housing price growth in Australia over the past 25 years and prediction for next 25 years in Sydney, Melbourne and Brisbane

Strong housing market conditions over the last 25 years have boosted median house values by over 400pc for houses and 300pc for units compared to 261% for ASX value 

The capital gain over the past 25 years equates to an annual growth rate of 6.8% for houses and 5.9% for units.

Investing in these asset classes have provided homeowners with a significant wealth boost, and one of the main ingredients for building this wealth is leveraging your asset growth with debt, which has largely grown in the same proportion as property prices .

And using debt to fund the purchase of growth assets is a massive leverage to create wealth.

So how do the numbers extrapolate?

At the same rate of growth over the next 25 years, Australia’s national property values could rise to $2.9 million for houses and $2.1 million for units by 2043

If the historic averages play out over the next twenty five years, Sydney values would be breaking the $6.3 million mark and Melbourne would be over $5.8 million

Sounds a lot? 

25 years ago $1m for a property sounded a lot!!

One thing you can be sure of…..

The housing markets will continue to move through their cycles, with periods of growth, decline and steady values conditions ….. 

….. but in my view …. over time these cycles will smooth out the year to year volatility in growth rates.

Source: CoreLogic Median values have been extrapolated based on applying the annual compounding growth in median values over the past twenty five years to current median house and unit values.

If you are looking to grow wealth – be sure you have 

  • A top accountant
  • An ethical financial planner who cares and does not work on commission 
  • A property consultant or buyers agent 
  • A mortgage broker 

Interested to learn more? 

Like this post or comment below and I will invite you to our forums and share relevant insights with you …. and I would be delighted to refer you to people who I know like and trust! 

Posted on February 13, 2020

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