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Forecast rising interest rates will affect the housing industry says a Global Real Estate Trends report.
The report studied the housing market in 12 advance economies during the year and concluded that Australia had one of the most robust internationally due to comparatively low unemployment rates and steady housing supply.
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It was found that housing prices rose in Australia, Canada, France, Sweden, Switzerland and the United Kingdom while maintained steady rates in Germany and the United States. On the other hand, prices dropped in Ireland, Italy, Japan and Spain.
The reports said that the recent interest hikes and a decrease to the first homeowners grant slowed the hot property market for the year. Analysts predict that the Reserve Bank of Australia will eventually lift interest rates again next year because of strong Asian trade.
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"Higher interest rates will worsen already strained affordability," said Economist Adrienne Warren in a statement. In other markets, Canada’s housing market did well but was considered one of the most volatile. The market is forecast to be stabilize as the employment rates improve and income increases. Germany’s housing slump ended this year and the U.K. property market showed signs of recovery although the rest of Europe namely Spain, Ireland and Italy housing markets continued to decline.
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In Asia, Japan's property slump showed no signs of abating and is forecast to persist next year because of the slower economic growth. The U.S. market was a surprise, showing signs of stabilizing after a rocky period.
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