Property price growth in Melbourne and Sydney has stalled, as affordability constraints and higher fixed-interest rate mortgage rates start to bite and crimp demand.
Tim Lawless, director of research at CoreLogic, expects Tuesday’s figures for February to show the first month-on-month decline in Sydney prices since September 2020. “The pace of growth has been softening amid worsening affordability, rising fixed mortgage rates and a normalisation in advertised supply levels,” Lawless says.Advertisementsaid the property price boom is showing clear signs of slowing. They are expecting a “broad-based correction phase” to begin later this year and into 2023 and 2024, as interest rates rise.
“With affordability already stretched in many markets, rate rises will have a direct impact on the borrowing capacity of buyers and their ability and willingness to sustain high prices,” the economists said. Price growth would be primarily determined by the direction of interest rates and incomes growth, Dr Wilson says. However, wages growth remains below the 3 per cent annualised rate that the RBA has said would need to occur before it would start lifting interest rates.
jcollett_money Not so in close regional cities.
jcollett_money You spout the same crap, week in, week out, year after year. House prices just keep going up, regardless, because of NegativeGearing and ChineseInvestors.
jcollett_money May be? US inflation is already at 39-year high. Last time this happened, interest rates were 18%. So good luck if you borrowed to buy on the top.
jcollett_money ...as long as negative gearing remains.... the housing boom will never be over.