Melbourne’s property market has been subsiding since late last year. Sydney’s market slide began in February. Across other markets, such as Perth and Brisbane, values are still climbing albeit at a slower rate. That’s exactly what you would expect when the Reserve Bank increases interest rates by a collective 0.75 percentage points in two-and-a-half months. On an average NSW mortgage of $860,000, that rate increase is worth $400 in extra monthly repayments. The fact that the NSW mortgage is now $860,000 (up $400,000 over the
past decade) should be enough of a signal that the market has reached an affordability tipping point, which is another big issue in the price correction story. Just hours before Cotality released its data, the Housing Industry Association reported that affordability has collapsed in all key markets, falling to its lowest level since the association started tracking it in 1994.
Melbourne property market, Sydney property market, Reserve Bank interest rates, NSW mortgage repayments, housing affordability, Housing Industry Association, affordability lowest since 1994, Perth Brisbane property values, Cotality data
Prices falling?? cool cool, so when does it go back to normal for renters?
So they raised rates 0.75 and suddenly mortgages are $400 more? Seems like a scam tbh. Also why is NSW mortgage even going up if the market is “collapsing”??
My cousin says people in Melbourne can’t even sell because it’s like the banks froze everything. But then the article says Melbourne is “subsiding” since last year, so which is it? And if affordability is the lowest since 1994, does that mean we’re about to crash-crash or just vibes?
“Affordability tipping point” is such a weird phrase. Like okay, mortgages go up by $400 on an $860k average NSW one… but if prices fall, wouldn’t that help? Sounds like they’re mixing up price drops with interest rate stuff. Either way the Reserve Bank can’t just keep jacking rates and pretend housing will be fine.