Australians' intentions to break into the housing market remained strong despite the COVID-related lockdowns in some parts of the country at the start of the year, the latest poll by Commonwealth Bank (CBA) shows.
The home buying spending intentions among Australians continued its upward trajectory in January after consistently increasing towards the end of last year, according to the Commonwealth Bank Household Spending Intentions (HSI) series.
The poll showed that both the number of mortgage applications and Google searches related to home purchasing was higher in January compared to a year ago.
Stephen Halmarick, chief economist at CBA, said the robust demand for housing this year could potentially increase residential property prices by 8%. Furthermore, he said the housing market will be a crucial driver of the economic recovery this year, as it continues to benefit from the low-rate environment.
"Our view remains that the Australian economic recovery from the COVID-19 recession is well underway," he said.
According to CBA forecasts, the Australian economy is expected to grow by 4.2% this year. The unemployment rate is predicted to decline to 5.7% by the end of the year.
The poll also showed strong spending intentions in the areas of entertainment, travel, education, and health and fitness. On the other hand, prospective spending for retail and motor vehicle remained flat over the month.