CoreLogic

While markets expected a pause, the RBA board’s hawkish tone implying a further cut in August surprised many. For Australia’s property sector in particular, observers say the path to a soft landing may be getting even more treacherous.

Economists attributed the rebound partly to the market’s expectations that interest rates had peaked. But the other key driver – the drastic supply/demand imbalance – means higher prices, especially for rents, may be further complicating the central bank’s task.

While the housing market shows faint signs of recovery following the RBA’s decision to pause interest rate hikes, those benefits have not yet begun to flow through to Australia’s rental market, new research shows, with all signs pointing to a long-term rental crisis.

Australians’ penchant for property investment comes with the caveat that patience is a necessary virtue. This applies doubly so for fretful LRBA holders, writes Nicholas Way.

New data shows Australian house prices have dropped 8.4 per cent since their peak in May 2022, the largest decrease on record. While further RBA rate hikes could deepen the downturn, experts say a crash in 2023 is not inevitable.

Economists agree the outlook for house prices in 2023 is largely dependent on upcoming interest rate decisions by the Reserve Bank of Australia, and signs of weakness are already appearing. Complicating matters further, borrowers face an impending fixed-rate cliff.

COVID-19 has started a property downturn in Melbourne and Sydney, according to results released by Corelogic. May 2020 property downturn starts CoreLogic Home Value Index results for May showed that five of the eight capital city regions dropped in value. Property transactions had completely dropped off in April 2020 as the restrictions limited property buyers…