Is the housing market going to go up or down in the next couple of years? I'm predicting level prices for a year or two. Agree?

It will go up, and up, until I decide to invest in some rental property. Then the bubble will burst.

The affordability index for new owners is apparently at an all time low/high - meaning extra hard for newbies to get started buying and in the greater new development areas where everybody wants a mini mansion the number of defaulters is increasing and just this or last week I heard numbers of new houses being built was down, both of those factors you would think somewhat neutralising out on supply/demand, and price direction?

There's even talk that though interest rates may not move in immediate months, the next move, even if next year will be up and I suppose while we collectively just want to keep buying new goodies and supposedly buoy the economy that may well be true.
9% superannuation for everyone also helps keep that investment bubble inflated but for some the higher interest rates can be the pin.

My money is on prices continuing to burble along, especially inner city, there being the the flat spot roster in play, ie Melbourne and Sydney are up, Brisbane's flat and then Perth become the hotspot while M/S languish and Brisbane & Adelaide get a bit of a lift and even Hobart gets a mini show, all until the straw that breaks the camel back - http://www.oilcrashmovie.com/ - and just when will that be?

The only people that can buy anymore are the ones that already have property and are trading up to something bigger. Or so it seems. Won't that eventuallly have an impact, with few new buyers going into the housing market? Will there be a boom in lower end houses and flats?

> Won't that eventuallly have an impact, with few new buyers going into the housing market?

Yes, it's becoming more difficult for new home buyers. People generally have to live further out in the burbs to find something they can afford.

> Will there be a boom in lower end houses and flats?

There were some recent changes to the superannuation rules and people were selling off their investments, which led to a shortage in rentals, pushing rents up and then creating a new demand for investment properties. It's a vicious cycle.

Anything inner-city holds the value well with some good increases in values. Homes far from the city generally go up mich slower. It's location more than anything that tends to affect property values in Australia.

I guess that's true anywhere. But interest rates and supply obviously have an impact.

The number that I think is most important is the monthly outlay. If you have to come up with more money every month than you can manage, you are out of the market. Sometimes interest rates do you in, and sometimes it's the price of the house. My prediction is that prices are getting high enough to keep people out of the market for a while.

Gecko -

Be sure to tell us when you decide to buy rental property, so those of us who already have some can sell.

I feel the same way. My entry into a market is a guarantee of a crash.

Though my prediction would be higher prices for the next couple of years.

From now on the two of you must report all investment moves to this forum, and we will all do the opposite.

Good day everyone.

Look like the property market for rental is really tight. We are hoping and praying that we will be able to get a decent apartment close enough to the university where my husband is going to study and near amenities so we do not need to travel much.