Don’t fight the tape

front-cover-v3_460-300x200-1There’s an old share market adage, “don’t fight the tape” meaning trends remain in place and prices rise much longer than expected. The Sydney property market is no different. Twelve months ago property experts were calling an imminent top in Sydney property prices. August 2015 those same experts, the Reserve Bank included, are warning houses prices may fall and here we are 20% higher. I guess if you want to forecast future prices, do it often..

Admittedly fundamentals are clouding what has been a stellar run in Sydney town. The domestic economy looks patchy at best, China’s economy is slowing and our political landscape continues to inhibit real change. On the positive front a weakening Australian Dollar might fire up the manufacturing sector and off-set the weakness in the mining sector. Chinese demand for Sydney property will continue to be the wild card and there is no sign of a slowdown from these buyers.

Now don’t get me wrong. We will see a correction in Sydney property prices. I don’t know when or from what lofty level. I do know there are three certainties in life: Death, Taxes and Sydney house prices don’t collapse when mortgage rates are around 4%!

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