Why the Bank Forecasts Are Worth Reading; But Not Necessarily Believing
Every few months, one of the Big Four banks releases a property forecast, and the headlines follow. Up six percent. Down four. Steady as she goes.
For Gold Coast homeowners preparing to sell, these numbers can feel reassuring or alarming depending on which way they’re pointing.
But there’s a case to be made for reading them with healthy scepticism, and understanding why it may actually make you a more confident seller.
The Track Record Is Patchy at Best
In May 2020, the major bank economics desks forecast that Australian property prices could fall by 30 percent or more in the COVID downturn. CBA’s worst-case scenario was a crash of around 32 percent peak to trough.
What actually happened nationally was a fall of roughly 2 percent; before the biggest property boom in a generation. The forecasters were wrong by approximately thirty percentage points.
It wasn’t a one-off. In late 2021, every Big Four desk forecast that 2022 would be an up year; predictions of positive five, six, seven, and eight percent were common.
Prices peaked in May 2022 and then fell around eight percent. Directionally inverted within six months of publication.
This isn’t a criticism of the economists involved. Forecasting is genuinely hard, and turning points in property markets are notoriously difficult to call.
But it is worth keeping in mind the next time a headline number influences how you’re thinking about your own sale.
Why the Numbers Tend to Skew Optimistic
There’s also a structural reason why bank forecasts lean bullish. Banks originate mortgages and hold existing loans against property as collateral.
Property listing portals make money from transaction volume. Neither has a commercial interest in telling you the market is about to soften.
The career risk for an economist who calls a downturn that doesn’t arrive is much greater than the risk of missing one that does. That asymmetry tends to show up quietly in the numbers.
Independent analysts, who don’t carry the same institutional incentives, have historically called market turning points more accurately.
That doesn’t mean the independents are always right either, but it does suggest the value of reading widely rather than relying on a single source.
What’s Actually Happening Right Now
The current picture is more nuanced than most headlines suggest, and it varies significantly by city.
Melbourne, for example, is the only major capital that hasn’t made a new high since its March 2022 peak, while Brisbane, Perth, and Adelaide have printed new records, and Sydney recovered its peak last year.
Melbourne has faced a particular combination of pressures: significant changes to land tax thresholds, tenancy reforms, and a higher-rate environment have prompted many investors to reassess their holdings.
Auction clearance rates in Melbourne have been running in the low-to-mid fifties, well below the roughly 65 percent that signals a balanced market.
The Gold Coast operates under its own dynamics, shaped by population growth, lifestyle-driven demand, and a buyer pool that includes interstate and international purchasers.
But the broader national picture, interest rates, borrowing capacity, and buyer confidence flow through every local market, including ours.
The Part That Matters Most for Sellers
Here’s the insight worth holding onto through all of this: the market you sell in is the same market you buy in.
If conditions feel soft when you’re selling, they’re usually equally soft when you’re purchasing your next home.
The same forces compressing your sale price are typically working in your favour on the other side. Sellers who focus only on what they’re leaving on the table often overlook what they’re gaining at the next door.
The people who tend to struggle most aren’t those who sell in a difficult market. They’re those who spend years waiting for perfect conditions that never quite arrive; watching their next chapter get deferred, season after season, while the market does what markets always do: move in cycles they can’t control.
Why Bank Property Forecasts Often Get It Wrong | What This Means in Practice
Forecasts are useful for context, but they’re not meant to be a decision-making tool. A prediction of national growth or decline tells you nothing specific about your suburb, your street, or the particular group of buyers your home will attract.
What actually determines your result is more local and more personal than any bank forecast: how your property is priced relative to comparable sales, how it’s presented and marketed, how much genuine buyer competition your agent can generate, and how well they negotiate when the moment arrives.
Those variables are within your control in a way that interest rate projections never will be.
The forecasts will keep coming.
Read them with interest.
Just don’t let them be the thing that makes or breaks your decision.
Author: Craig Douglas
Please Note: The information contained in this document is for general information purposes only and does not constitute legal advice. The laws and regulations governing the sale of property in Queensland are complex and constantly changing. It is important to seek the advice of a qualified property lawyer or conveyancer before making any decisions about the sale of your property. This document does not take into account your individual circumstances and may not apply to your situation. By reading this document you agree that you have not relied on the information contained herein and that you will seek independent legal advice before taking any action.
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