Recent study by Australian Bank predicts future capital growth in property real-estate

A recent study by National Australia Bank (NAB) supports predictions of future capital growth, the bank’s Residential Property Index results for the first three months of this year recorded an increase of one point to 37 points, plus there is a range of supporting data to show positive movement.

Queensland is expected to show the biggest gains in the next one to two years with Alan Oster, who is the Chief Economist at NAB, saying that Queensland the Sunshine State will be the big winner.

House price expectations strengthened in all states except Victoria, with Queensland expected to show the biggest gains in the next one to two years.

The NAB says the outcome of the data reflects improved sentiment in the Northern Territory, South Australia and New South Wales, which offset softening in Victoria and Western Australia.

The NAB report notes there’s an expectation of house prices improving over the coming twelve months.

Price growth over the coming year is tipped to be 3.5% in Queensland, and 3.3% in NSW.

In the two years to March 2016, Queensland will once again lead the way with a 4.4% predicted gain.

Capital cities are the place to be according to Mr Oster, “We expect average capital city house prices to rise by 7.7% cent through the year to end 2014, with Brisbane to be the strongest city for capital gains”

He also said the biggest impediment to buying new property is seen as a lack of both credit availability and housing affordability, however concerns over interest rates are starting to rise.

“In the established housing market, employment security continues to be seen as the biggest impediment to buying property in most states, with NAB expecting further softness in the labour market.”

Oster says despite these negative influences, the bank remains bullish about Australian Real Estate.

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