Highlights:
The current state of the global economy makes it difficult to predict where property prices would be in three months, let alone seven to 10 years into the future. With the economy in the doldrums, is it too optimistic to think that the average Australian median house price, currently around $447,875 could double in value to $895,750 in 2019 and again to $1,791,500 in 14 to 20 years time?
The rule of 72
For a simple way to work out how long it has taken a property or an area to double in value, divide 72 by the annual growth rate. If you want to know how many times it has doubled over a particular time frame replace the annual rate by the average annual rate over the same time period.
For Example:
If you think a property will grow 10% per annum, just divide 72 by 10% and that tells you that it'll take 7.2 years to double.
Full article online from Your Mortgage
The current state of the global economy makes it difficult to predict where property prices would be in three months, let alone seven to 10 years into the future. With the economy in the doldrums, is it too optimistic to think that the average Australian median house price, currently around $447,875 could double in value to $895,750 in 2019 and again to $1,791,500 in 14 to 20 years time?
The rule of 72
For a simple way to work out how long it has taken a property or an area to double in value, divide 72 by the annual growth rate. If you want to know how many times it has doubled over a particular time frame replace the annual rate by the average annual rate over the same time period.
For Example:
If you think a property will grow 10% per annum, just divide 72 by 10% and that tells you that it'll take 7.2 years to double.
Full article online from Your Mortgage
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