More than half of the country is now experiencing declines in property values.
That’s according to a suburb-level analysis from PropTrack by The Australian.
The biggest decliners in Sydney in the June quarter were houses in Mulgoa in Sydney’s west (-22.72%), units in Taren Point in Sydney’s south (-22.11%) and units in Manly (-20.44%).
In Melbourne it was houses in Dandenong South in the southeast (-20.86%), houses in Red Hill (-20.36%) and houses in Flinders (-19.34%), both on the Mornington Peninsula.
PropTrack director of economic research Cameron Kusher said the housing market in Sydney and Melbourne had already slowed before interest rates rose in May.
“Interest rates are up 1.25 percent in three months,” he said The Australian.
“That means people can’t borrow as much as they could. And if rates go to 2.5 percent, as expected, that will dramatically reduce people’s ability to pay the prices that people are looking for in these markets”.
In Hobart, the data showed units at Battery Point, just south of the CBD, fell the most in the June quarter (-20.58%).
In Adelaide, these were units in the coastal suburbs of Hove and Grange (-16.14%).
Units in the Canberra suburb of Watson fell by -22.89%, the biggest in the capital cities, and houses in Griffith fell by -22.42%.
Homes in the affluent Perth suburb of Peppermint Grove fell -13.34%.
Houses in Larrakeyah, an inner suburb of Darwin, saw a decline of -20.60, and units in Birkdale, Brisbane, declined -22.69%.
All four of Australia’s big banks unanimously expect stronger interest pain for borrowers after Westpac and NAB upgraded their cash rate forecasts.
Westpac, NAB, ANZ and the Commonwealth Bank of Australia predict there will be two increases of 0.50 percentage points in both August and September, meaning four straight months of 50% increases.
NAB now expects the cash rate to stand at 2.85 per cent in November, while Westpac expects it to rise to 3.35 per cent in February next year.
It means someone who had a $500,000 NAB mortgage before the rises started could be paying $760 more in their monthly repayments, while monthly repayments on a $500,000 Westpac mortgage could rise by $908 from from May 2022 until February next year.
While home prices may be falling across the country, the cost of renting certainly isn’t.
According to the latest report from PropTrack, rental prices grew at the fastest pace in seven years in the year to June.
Weekly rental prices rose by 7% in the year to June. The number of potential tenants per listing increased by 20.3%.
The volume of total rental listings was 18.2% lower year-over-year, which meant volume was 27.7% lower than its decade average.