Housing market prediction

He notes that migration, a big contributor to the housing market’s current strength, contributed a percentage point, or 38,200, to last year's 1.6% population growth and that the average annual increase in residential investment was 19%.

Randall expects migrant inflows will abate this year, but notes that February’s inflow was a record.

He also notes that the Reserve Bank’s Official Cash Rate (OCR), currently 5.75%, is 0.75 percentage point below its 10-year average, which has also contributed to housing market’s strength.

Nevertheless, because the economic outlook is weakening, the market expects the OCR will fall to 5.25% by the end of the year, "which should assist affordability and ensure that housing activity does not fall off a cliff," he says.

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