Australian home values fall for seventh month as rates bite

Summarised from 2 outlets · Updated 1 Nov, 23:56 · Archive

Australian home values have dropped for a seventh consecutive month, with capital city prices falling at the fastest pace in 40 years.

Australian home values have dropped for a seventh consecutive month, with prices in capital cities now falling at the fastest pace in 40 years. Combined values across state and territory capital cities fell 1.4 per cent in October, bringing the total decline since March to 8.1 per cent. The median Australian house price has fallen to $884,855, a drop of about $63,400 from the March peak.

The centre of the downturn has shifted away from Sydney and Melbourne towards mid-sized state capitals. Brisbane recorded a 2 per cent monthly fall in October and a 6.1 per cent decline over the quarter, whilst Perth fell 1.7 per cent monthly and 5.7 per cent quarterly. Sydney declined 1.6 per cent in October and 4.7 per cent over the quarter. Tim Lawless, Cotality's research director, said the correction was now broad-based. 'Virtually every suburb across Brisbane, Perth and Adelaide has recorded a drop in value over the past three months,' he said.

Rising mortgage rates are the primary driver of the downturn. Four interest rate hikes have already occurred this year, with a fifth widely expected when the Reserve Bank announces its decision on Tuesday. Affordability challenges and a pullback in investors following government tax changes have also dampened demand. Morgan Stanley is forecasting peak-to-trough price drops of up to 15 per cent.

How it is being reported

• Australian property prices plunging at fastest rate in 40 years after seven straight months of falls as rate decision loomsProperty prices have plummeted for a seventh straight month, with the decline tracking faster than any previous downturn over the past four decades.Daily Mail · 1 Nov, 23:43
• Home values fall for seventh consecutive month as interest rates dent demandCentre of downturn shifts away from Sydney and Melbourne, but after such strong growth most homeowners still sit on sizeable gains Get our breaking news email , free app or daily news podcast Australian home values have dropped for a seventh consecutive month, with prices in the capital cities now falling at the fastest pace in 40 years as rising mortgage rates scare off buyers. Cotality data shows the centre of the downturn is also shifting away from Sydney and Melbourne toward the mid-sized state capital cities, with Brisbane and Perth leading October’s declines. Continue reading...Guardian World · 1 Nov, 14:00

In this story: Australia · Sydney · Melbourne · Brisbane · Perth · Adelaide · Reserve Bank · Cotality

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