The World Bank has given dire warnings of a new financial crisis so severe it will eclipse the chaos of the GFC. It has halved its economic growth forecast for this year in high-income countries and says financial markets may even stop working if lenders refuse to roll over European debts.
But closer to home, some in the local property industry are shrugging off negative outlooks - depending on how you read the figures.
The total number of houses and units for sale across Australia fell one per cent in December to 385,036: the first monthly drop since August. This could offer the housing market hope, but it was still 18 per cent higher than a year earlier, according to SQM Research.
Price expectations have risen to 25.1 points this month, up from nine points in October. It's the first gain in a year but Matthew Hassan, senior economist at Westpac Banking Corporation
(ASX:WBC), who published that figure, says while consumers have a more positive outlook for house prices this year, gains are still not the majority view.
Westpac says Just under half (47.6 per cent) expect prices to be higher in a year, 30 per cent expect no change and the rest (22.5 per cent) expect further price declines.
The biggest rise in those house expectations is from the group that drives first home buyer demand: the median age of first home buyers is 32, and more than half of those aged under 35, say prices are going up this year. And if you were wondering where your age group sits, the median age of an upgrader is 45, and a housing investor is 48.
So despite that gloomy global outlook from the World Bank, 2012 might just be the year of recovery the Australian housing market has been waiting for.
Our economy is set to grow at above trend by four per cent in 2012 according to the Organisation for Economic Co-operation and Development (OECD), to be driven by record levels of investment in the resources sector.
Australian Property Monitors says capital city markets with direct exposure to the resources sector can be expected to record significant growth in house prices over the year. APM says after falling by -4.2 per cent over the year to October 2011, national median house prices should recover, to rise between three to five per cent this year.
They say Sydney provides a solid prospect for median house growth; Melbourne and Adelaide will struggle; Brisbane will revive itself after last year's natural disasters; Perth is one of the best prospects with an increase in buyer activity; Canberra and Hobart will grow; and Darwin has prospects of sustaining itself.
It's now a matter of seeing how those figures fulfil themselves.
Finally, let's have a look at some home loan data from the Australian Bureau of Statistics:
Fixed home loans rose to 11.1 per cent in November from 10.6 per cent - the highest proportion since the financial crisis in 2008.
And fixed or not, the demand for home loans increased for the fifth straight month in November, a seasonally adjusted 1.4 per cent to 46,953. That result comes after a downwardly revised 46,293 in October.
