00:01The report shows that prices are cooling off in some of our biggest markets.
00:06So in Sydney, with that forecast of a fall of up to 7%,
00:10a house in Sydney could lose more than $120,000 in value the next financial year.
00:16In Melbourne, with domain forecasting prices to drop by up to 8%,
00:21we could actually see the median house value fall below that $1 million mark,
00:25which it has been sitting on for quite some time.
00:27And Canberra also expecting a bit of downward pressure with houses,
00:31expected to fall by about $40,000 in the next year.
00:36Now, the interesting thing in this data is it shows that unit prices will actually outperform house prices.
00:43Domain says that's because people's borrowing capacity has been constrained by the recent rate rises.
00:48So people are looking to get into the market by buying units instead of houses.
00:53Now, it's not the same story for markets across the country.
00:57So some markets are continuing to grow.
00:59In Perth, Domain forecasts that house prices will continue to grow by about 5% over the next financial year.
01:06Brisbane and Adelaide could also see growth of around 3% to 4%.
01:10So not the same story everywhere, but some cooling off definitely happening in the major markets.
01:15Depending on who you speak to, everyone's got a different opinion on this.
01:19But an economist from Domain says that part of the reason, in addition to the recent rate rises, is tax
01:26policies.
01:27So changes to the capital gains tax discount and negative gearing could be having an influence.
01:32But the federal government has been very quick to shut this down.
01:35It says that these figures don't reflect what Treasury has forecast for the year ahead.
01:40So here's Minister Jason Clare.
01:42That's not the forecast from Treasury.
01:44So, you know, I'd view that with, you know, a bit of a healthy dose of scepticism.
01:50The advice from Treasury is that house prices will continue to grow, but in a sustainable way.
01:55What the challenge that we have as a country here is that prices have grown in an exponential way.
02:00It's why we say the system's broken at the moment.
02:03What's worth noting is this new data does seem to mirror what we saw from quotality just last month.
02:10Its figures show that property prices around the country had flatlined for the first time since January last year.
02:17The concern for some is that even with prices cooling off in some of these markets, affordability still remains an
02:23issue.
02:23And when you tap that on to other pressures, this all can add up and then weaken the housing market.
02:30Here's what property and independent property expert Cameron Cusher said earlier today.
02:35We've obviously had three interest rate increases so far this year, and this is exacerbating the slowdown in the housing
02:42market.
02:42And then the federal budget announced some significant changes around borrowing to investors.
02:48And that's probably not showing up too much in the data as such yet, but it's certainly weighing on sentiment
02:55and is likely to lead to weaker housing market conditions going forward as well.
03:00Another interesting point that Mr Cusher raises is the broader impact all of this can have on the economy.
03:06So when people see house prices drop that they tend to tighten up their budgets and then spend less, which
03:14can add further pressure on the broader economy.
03:17So we'll have to wait and see whether what domain is forecasting actually plays out and whether we'll see these
03:22other effects as well in the next financial year.
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