House prices fall 5% as Australia enters housing correction
House prices have fallen 5 per cent from their peak, with forecasts predicting further drops of 7 to 15 per cent.
Australia's housing downturn is picking up pace. Prices are now more than 5 per cent below their peak.
The big banks predict prices will fall another 7 to 15 per cent. Morgan Stanley says this is the biggest correction in 40 years.
Higher interest rates have cut how much a typical household can borrow by about $90,000 this year. More than 32 per cent of borrowers are now at risk of mortgage stress, up 8.4 per cent since January.
Prices are falling but interest rates are still at their highest level in 15 years, so most people are not seeing relief. New Zealand and Canada both had similar housing booms during the pandemic.
Both saw sharp price falls that have now started to ease their affordability problems.
- 5 per cent from peak
- Price decline so far
- 7 to 15 per cent
- Predicted further decline
- $90,000 for median household
- Borrowing capacity cut
- 32 per cent of borrowers
- Mortgage stress risk
Why it mattersFalling prices help little when interest rates stay high. Many households are still under severe financial stress.
AustraliaMillions of Australian homeowners and renters face mortgage stress and tight rental markets as prices fall but affordability remains poor.
✓ Claims checked against the source. checked 1 h ago
Open this story in InSnip →
