Gareth Kent, Director at Preston Rowe Paterson Geelong, explores how global events, including Donald Trump's re-election, could impact local property markets like Geelong. The ongoing Ukraine-Russia War has significantly influenced global inflation since February 2022, contributing to a peak in Australian inflation at 7.8% in December 2022. Consequently, Australian house prices saw a national drop of 8.4% between May 2022 and January 2023. However, by September 2023, the cash rate eased from 5.4% to 4.35%, allowing for some recovery, with national housing growth recorded at 6.16% over the last year, while Geelong's local growth lagged behind at only 1.4% to 4.5% [848ece4b].
Trump's election in 2024 has raised concerns about potential tariffs that could adversely affect Australian exports, particularly iron ore and coal, which are critical to the local economy. As of October 2024, the median house price difference between Melbourne and Sydney reached 53%, highlighting the varying dynamics within Australian property markets [848ece4b].
Victoria currently faces the highest mortgage arrears in the country and is ranked as the third poorest state in Australia, with public debt increasing by 319% during Labour's governance. The Reserve Bank of Australia's (RBA) decisions will be pivotal for the property market, especially with Trump set to take office on January 20, 2025, just before the RBA's next meeting on February 17, 2025 [848ece4b].
As the economic landscape continues to evolve, the interplay between Trump's policies and local market conditions will be crucial for property investors in Geelong and beyond. Investors will need to stay informed about potential changes in tariffs and economic policies that could impact housing prices and market stability in the region [848ece4b].