House prices head for historic 10% drop as fourth interest rate hike looms
Summary
House prices in Australia are falling in more than 90% of suburbs, and values are expected to drop about 10% from their recent peak over the next six to nine months. Despite this, the Reserve Bank of Australia plans to raise interest rates again to control inflation, as the housing downturn is not their main concern.Key Facts
- House prices are declining in over 90% of Australian suburbs.
- Average home values are expected to drop about 10% nationally, which would be the largest fall since World War II.
- Sydney and Melbourne property prices could fall 12-13%, while Brisbane, Perth, and Adelaide may see around 8% drops.
- Even with these falls, housing will remain unaffordable in many cities.
- The Reserve Bank of Australia plans a fourth interest rate hike to fight inflation.
- Inflation remains high despite the slowing economy and housing market downturn.
- The Australian economy is expected to have grown only 0.1% in the last quarter, the slowest in two and a half years.
- Experts say the RBA will continue to raise rates because inflation is the bigger problem, not falling house prices.
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