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The latest data on the houses show that prices in Sydney and Melbourne in August for the first time since the dizzying heights of late 2017 increased by more than 1 percent. This house in Schofileds, NSW, was sold for almost the new average of $ 877,220

House prices in Australia are bouncing back, but it can only be a temporary respite with tough economic times ahead.

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The latest housing data shows that prices in Sydney and Melbourne rose by more than 1 percent for the first time since the staggering heights of late 2017 in August.

Auction clearance rates have also risen to more than 80% in Sydney and 75% at the national level last week – considerably more than 58% in December 2017.

However, real estate experts are divided as to whether this is the start of a new, albeit smaller, or a case of so-called dead cat bounce.

The latest data on the houses show that prices in Sydney and Melbourne in August for the first time since the dizzying heights of late 2017 increased by more than 1 percent. This house in Schofileds, NSW, was sold for almost the new average of $ 877,220

The latest data on the houses show that prices in Sydney and Melbourne in August for the first time since the dizzying heights of late 2017 increased by more than 1 percent. This house in Schofileds, NSW, was sold for almost the new average of $ 877,220

Martin North, head of Digital Finance Analytics, warned against reading the trend and expects prices to fall again in the new year.

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& # 39; Over the past few weeks, the enthusiasm that emerged after the election seems to be diminishing & he said to Daily Mail Australia.

& # 39; For me it has not yet been proven that this is a sustainable recovery. & # 39;

North said the increase was caused by stronger sales in the prosperous inner city of Sydney and Melbourne, not so much in the suburbs where the average Australians live.

A story about two major cities leading the recovery

SYDNEY: accommodates 1.5 percent to $ 877,220; apartments rise 1.8 percent to $ 699,126

MELBOURNE: accommodates 1.3 percent to $ 716,542; apartments with 1.5 percent to $ 540,056

CANBERRA: accommodates 1.1 percent to $ 665,887; apartments down 0.3 percent to $ 426,088

HOBART: accommodates 0.8 percent to $ 498,734; apartments fell 0.9 percent to $ 375,831

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BRISBANE: houses flat at $ 533,101; apartments increase by 1.1% to $ 375,423

ADELAIDE: accommodates 0.3 percent to $ 462,945; units increased by 0.4 percent to $ 322,142

PERTH: homes falling 0.6 percent to $ 454,774; units a decrease of 0.1 percent to $ 345,311

DARWIN: accommodates 1.6 percent to $ 470,099; apartments fell 0.5 percent to $ 289,687

Source: CoreLogic Home Value Index for August 2019

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Interest in high-rise apartments was also considerably delayed after Opal and Mascot Towers were evacuated in Sydney about cracks in the structure.

Many owners in those buildings are not allowed back, their units are now worthless and they have to pay thousands for repairs.

& # 39; If you are suddenly asked to pony $ 60,000 to repair your unit, it will be a damper on things, & # 39; said Mr. North.

He also warns against reading too much in approval percentages because the number of sales was low and therefore prone to being blown up by anomalies.

The enthusiasm of home ownership increased after the election result and two interest rate cuts, and the Commonwealth Bank said it had the most home loan applications in 10 months the week following the vote on May 18.

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It was also expected that Prime Minister Scott Morrison would push up the $ 1,080 per person tax cut, but Mr. North claimed that this is not due to the wider economy.

& # 39; There was a rally after the election result and the two interest rate cuts, but people don't pass on the tax cuts, they use them to pay off debts, which is understandable in a time of uncertainty, & # 39; he said.

Mr. North pointed to new ANZ bank figures showing that consumer confidence was lowest in two years, despite warnings about the Australian economy.

The same figures showed that all other indicators decreased every week, with a measurement of current finances of 4.6 percent in a week.

The degree of future finances fell by 4.8 percent and the percentage of people who thought it was a good time to make a major purchase – such as a house – fell by 7.1 percent the previous week.

This house in Seven Hills, NSW, was sold in August for the rising Sydney average as prices recover from more than a year of free fall
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This house in Seven Hills, NSW, was sold in August for the rising Sydney average as prices recover from more than a year of free fall

This house in Seven Hills, NSW, was sold in August for the rising Sydney average as prices recover from more than a year of free fall

Martin North, head of Digital Finance Analytics, believes that the recovery will not last and that Australia will fall even more next year

Martin North, head of Digital Finance Analytics, believes that the recovery will not last and that Australia will fall even more next year

SQM Research director Louis Christopher predicts that prices will continue to rise for some time

SQM Research director Louis Christopher predicts that prices will continue to rise for some time

Martin North (left), head of Digital Finance Analytics, believes that the recovery will not last, while Louis Christopher (right) SQM Research is more optimistic

Data from the Australian Bureau of Statistics also showed that retail sales growth was barely above zero: an increase of 0.4 percent in June and only 0.2 in the past year – lower than during the global financial crisis.

Store volumes per capita decreased and were 1.4 percent lower than a year ago, indicating that population growth was all that boosted sales.

"Consumer confidence is very negative, as are small businesses, and the government is not going to spend money to stimulate the economy because it wants to have a (budget) surplus", Mr. North said.

International instability was the X factor that could make matters worse, and Australians have been there & # 39; more sensitive & # 39; in front of.

China's continuing trade war with the US and the recent attack on a Saudi oil facility were two issues that caused consumers to play it safe.

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& # 39; If the international situation resolves, it depends on the local economy and what employment does and I am less optimistic about that, & # 39; said Mr. North.

& # 39; I have seen the rise in unemployment in the retail and construction sectors and nothing to replace this. & # 39;

Prices in Perth are still falling, unlike the rise in Sydney and Melbourne, with this house selling almost the lower average of $ 454,774

Prices in Perth are still falling, unlike the rise in Sydney and Melbourne, with this house selling almost the lower average of $ 454,774

Prices in Perth are still falling, unlike the rise in Sydney and Melbourne, with this house selling almost the lower average of $ 454,774

Mr Noord predicts a modest rise the rest of the year before it slips again from January, although specific suburbs can do very well.

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His unenthusiastic prediction was that prices would be lower in two or three years than now.

However, SQM Research Director Louis Christopher had a much brighter prospect of the Australian housing market and expects the rise to continue.

"People were expecting a Labor victory that would have led to changes in negative gearing and capital gains tax, because that did not happen, they are buying again," he told Daily Mail Australia.

Mr Christopher said that Mr Morrison's tax cuts and interest rate cuts – with a greater chance of following – also worked.

& # 39; There are indications from the Reserve Bank that it may lower interest rates again this year and the closer it gets to zero, the more purchases you will see, & # 39; he said.

The enthusiasm of home ownership increased after the election result, when Scott Morrison promised no changes in negative gearing, which Labor promised to lower and would give $ 1,080 tax cuts
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The enthusiasm of home ownership increased after the election result, when Scott Morrison promised no changes in negative gearing, which Labor promised to lower and would give $ 1,080 tax cuts

The enthusiasm of home ownership increased after the election result, when Scott Morrison promised no changes in negative gearing, which Labor promised to lower and would give $ 1,080 tax cuts

This Melbourne property, which sold nearly $ 716,542, was sold in August

This Melbourne property, which sold nearly $ 716,542, was sold in August

This Melbourne property, which sold nearly $ 716,542, was sold in August

The Australian Prudential Regulation Authority, which has lifted its restrictions on housing loans, was another important factor.

But Mr. Christopher warned: & # 39; APRA could intervene if we again see double price increases in Sydney and Melbourne and it is already kicking the cage. & # 39;

He noted that the large auction season in the spring and summer was approaching, which would test the strength of the recovery.

Christopher was more optimistic about the Australian economy, but noted that if it got into a recession, the real estate market would be hit because unemployment would rise.

& # 39; The real estate market and the Australian economy are closely linked, so the government will do everything it can to ensure that it remains healthy & # 39 ;, he said.

This year he expected an average price increase of four percent in Sydney and two percent in Melbourne.

Economists in one Sydney Morning Herald survey was also less than enthusiastic and feared that the rally was actually a & # 39; dead cat rump & # 39; could be.

Melbourne (a property sold at the average shown), along with Sydney, led the recent recovery in house prices

Melbourne (a property sold at the average shown), along with Sydney, led the recent recovery in house prices

Melbourne (a property sold at the average shown), along with Sydney, led the recent recovery in house prices

Industry economist Stephen Anthony predicted a 7 percent drop in average house prices from Sydney to 2019-20 and a 12 percent drop in Melbourne.

Like Mr. North, he expected trends to reverse when the peak auction season began in the coming weeks.

Jakob Madsen of the University of Western Australia expected a fall of 5 percent in Sydney and 7.5 percent in Melbourne and claimed that people saved their money for a rainy day, while the economy did not look favorable.

The ones with a positive outlook were Stephen Koukoulas from Market Economics, who predicted that prices in Sydney would increase by 8% and 7% in Melbourne.

Those who try to buy houses hope that the gloomy market forecasts will come true, while those who have bought during the boom must limit their losses.

Prices have fallen by nearly 20 percent in many suburbs since the height of the economic boom, making them within the reach of families with a lot of money.

In Melbourne, prices in 18 suburbs are lower than five years ago.

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