Invest
What surprised the central bank? Parts of Australia are bucking history
Invest
What surprised the central bank? Parts of Australia are bucking history
Patterns in the latest rounds of property data are out of step with historical patterns and an “unusual” situation for investors in the 2019 market.

What surprised the central bank? Parts of Australia are bucking history
Patterns in the latest rounds of property data are out of step with historical patterns and an “unusual” situation for investors in the 2019 market.

The Reserve Bank of Australia (RBA) said that the fall in dwelling values across Sydney and Melbourne are out of the ordinary, particularly given the low mortgage rate environment and the declining unemployment rate.
The RBA observed that after rising by almost 50 per cent over the five years to September 2017, national housing prices fell by approximately 8 per cent to be back around mid-2016 levels.
Despite acknowledging the rise in property prices in Hobart and Canberra and “flat” price movements in Brisbane and Adelaide, the RBA noted the “significant” falls in Perth and Darwin and the “unusual” declines in Sydney and Melbourne.
The “noticeable decline” in foreign investors may be contributing to these patterns, according to the RBA.
Further, some of the movements in housing prices could be explained by the fact that the supply of housing does not respond quickly to changes in demand.
“In particular, the run-up in housing prices had occurred during a period when housing supply had not picked up sufficiently to match higher demand from more rapid population growth,” the RBA said.
“Over time, higher housing prices had eventually led to a sizeable increase in supply, but this had taken longer than in previous cycles,” the RBA said.
When will prices go up?
It’s near impossible to pick the market, but analysis from accounting and advisory firm KPMG indicates prices in Melbourne and Sydney should start heading north around in 2020 and 2021, respectively.
KPMG said the “push and pull” of market factors, such as the amount of dwellings, population growth and investor borrowing, will follow the previous trajectory of market falls and revert to growth conditions.
“Our housing update shows that the tougher regulatory actions and taxation measures by both federal and state governments we identified last year have had a significant effect,” said Brendan Rynne, KPMG chief economist.
“There has been a falling-away in foreign interest, notably from China, and lending to domestic buyers has got stricter, while housing supply has increased. This is why prices have declined, but we believe that process will reach its peak over the next few months and then go into reverse later this year.”

Property
Labor’s ‘Help to Buy’ scheme not without its risks
With Anthony Albanese sworn in as Australia’s 31st PM, home buyers are excited at the prospect of accessing the new ‘Help to Buy’ scheme, but a property expert has warned that the risks may be g...Read more

Property
Australia's housing market is entering a ‘broad-based correction phase’
Westpac believes the housing market downturn is now underway. ...Read more

Property
ANZ now expects house prices will end the year lower
With higher interest rates on the horizon, the bank is forecasting larger house price declines than previously expected. ...Read more

Property
Which capital cities are most attractive to property investors?
A new survey has suggested that investor attention is shifting away from Australia’s two largest capital cities. ...Read more

Property
Market uncertainty fails to discourage foreign property investors
While interest from foreign investors in Australian property has remained strong, HLB Mann Judd warned that tax increases could see demand shift to other markets. ...Read more

Property
Regional renters forced to spend more of their income than ever before
Renters in regional areas are spending nearly as much on rent as home owners are spending on mortgage repayments. ...Read more

Property
Aussie home buyers now need to save for over 11 years for a deposit
Since early 2020, the time needed to save for a deposit has increased by more than two years. ...Read more

Property
HSBC forecasts 2023 house price decline of up to 10%
The firm had previously predicted a modest rise for house prices next year. ...Read more

Wrapping up an eventful 2021
Listen now

What Omicron means for property, and are units right for first-time buyers? What is equity crowdfunding? Are industry super funds tapping into member funds to save their skins?
Listen now

Will housing affordability improve in 2022? Will buy now, pay later become the norm? Why are Aussies staying in failing super products?
Listen now

Who really benefits from crypto ETFs? How will the RBA respond to rising inflation? Could a mandate help address unpaid super?
Listen now

Property
Labor’s ‘Help to Buy’ scheme not without its risks
With Anthony Albanese sworn in as Australia’s 31st PM, home buyers are excited at the prospect of accessing the new ‘Help to Buy’ scheme, but a property expert has warned that the risks may be g...Read more

Property
Australia's housing market is entering a ‘broad-based correction phase’
Westpac believes the housing market downturn is now underway. ...Read more

Property
ANZ now expects house prices will end the year lower
With higher interest rates on the horizon, the bank is forecasting larger house price declines than previously expected. ...Read more

Property
Which capital cities are most attractive to property investors?
A new survey has suggested that investor attention is shifting away from Australia’s two largest capital cities. ...Read more

Property
Market uncertainty fails to discourage foreign property investors
While interest from foreign investors in Australian property has remained strong, HLB Mann Judd warned that tax increases could see demand shift to other markets. ...Read more

Property
Regional renters forced to spend more of their income than ever before
Renters in regional areas are spending nearly as much on rent as home owners are spending on mortgage repayments. ...Read more

Property
Aussie home buyers now need to save for over 11 years for a deposit
Since early 2020, the time needed to save for a deposit has increased by more than two years. ...Read more

Property
HSBC forecasts 2023 house price decline of up to 10%
The firm had previously predicted a modest rise for house prices next year. ...Read more