ANZ economists have significantly revised house price forecasts from a bearish 10 per cent decline to a 9 per cent lift in 2021.
The counterweight of low rates and government stimulus has flowed through to housing construction, approvals and sentiment, economists Adelaide Timbrell and Felicity Emmett said.
The peak-to-trough decline will be limited to 2 per cent, with Perth set to benefit from a 12 per cent lift as Brisbane and Hobart follow with gains of more than 9 per cent now forecast.
Sydney prices are expected to rise at about the national average of 8.8 per cent, while Melbourne will continue to lag slightly at 7.8 per cent.
“Our view that house prices would decline around 10 per cent, peak-to-trough, has proven too pessimistic: low rates have trumped factors like elevated unemployment and low population growth,” Emmett and Timbrell said.