The sharp fall in jobless rates for February unveiled by the Australian Bureau of Statistics has led to Archistar claiming the rates will fuel already high house prices.
Reaching near-pre-COVID levels of unemployment, the rapidly improving labour market is likely to spur confidence and housing affordability, adding upward pressure to already strong house prices.
The national unemployment rate has moved to 5.8%, the closest to the 5.2% recorded in March 2020 before the COVID-19 pandemic, with Queensland’s rate falling by 0.8% between January and February 2021. NSW and VIC reported the lowest jobless rates at 5.6%.
Dr Andrew Wilson, Archistar’s Chief Economist, says that a growth in the labour market will add further pressure to already-high house prices.
“Capital city housing markets have recorded strong buyer demand this year so far with prices rising sharply – particularly in Melbourne and Sydney. A rapidly improving labour market will enhance housing affordability and confidence, adding upward pressure on already strongly growing prices.
With the Jobkeeper stimulus concluding at the end of the month, Wilson says the impact of the conclusion will be very little.
“Any concerns over the possible significant negative impact on the economy of the tapering of the Job Keeper allowances at the end of this month will also likely to be to be misplaced – again.”