Quote:
Originally Posted by Doctorfever
That is interesting. Where is the source for your numbers? I am wondering what happens if you shift everything by say… 2 years. Hard to gauge by only looking at this specific 5 year increment.
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No, looking at 5-year increments isn't perfect; it was just a quick way to illustrate it without making a chart. But the data is
here (Real Residential Property Prices) and
here (Population).
If you overlay population growth over residential price growth you can sort of see the lack of real correlation. The axes don't really line up in a meaningful way, but you can get the idea:
The biggest growth in property prices was in the 2nd half of the '80s (which preceded the population boom then), from the late '90s to the late '00s (which had lower than average population growth preceding and during it), and 2009 to 2017 (which also had relatively low population growth until the very end, which then preceded a stagnant period pre-COVID).
Conversely, the fastest population growth was from 1988-1991 (which preceded the slowest growth in prices during the '90s) and 2018 to now (which has seen relatively flat prices after the COVID gains were erased).
As others have said, population growth can impact rental prices to a degree. And over the last 5 years, the growth in housing stock has lagged population growth by a bit, putting some pressure on that. But in terms of purchase prices, there's so much more going on that immigration or population growth doesn't really have a huge impact on its own. And even for rent, the mismatch we're talking about (i.e. reducing vacancy rates by under a percentage point) isn't going to make rents go up 30% on its own or anything. It just puts additional pressure onto the market.