housing market withstood all those factors and still provided strong price growth, due to demand outstripping supply,” Dr Brendan Rynne, KPMG Chief Economist, said. “Even the much-anticipated ‘fixed-rate cliff’ – the transition of mortgage holders off lower fixed rates to higher variable rates – had only had a mild impact and households generally coped well with the rate rises, due to a robust labour market and Australia’s historic low unemployment rate. offer relatively lower entry points compared to houses, making them more viable options for a larger pool of buyers.” The report predicts unit (apartments and townhouses) prices will rise by 4.6 per cent in 2025 and then 5.5 per cent the following year, as they represent a more realistic route into the housing market, given the ongoing affordability crisis. Price growth will be more pronounced in the second half of 2025, aligning with the interest rate cuts KPMG believes will start by the end of the second quarter. “While 2024 was a year of high interest rates and inflation and subdued consumer sentiment, the 6 BUSINESS VIEW OCEANIA VOLUME 07, ISSUE 01
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