BENGALURU : Australian house prices will fall sharply this year and next as rising mortgage rates and cost of living pressures drag on demand, a Reuters poll found, but for many people buying a home will still remain far out of reach.
Average home prices were expected to decline 6.5 per cent this year, according to an Aug 15-Sept. 2 Reuters survey of 10 property analysts, versus an expected 1.0 per cent rise in a May poll."The property boom is well and truly over as the surge in mortgage rates is pulling the rug out from under it," said Shane Oliver, chief economist at AMP.
Markets are wagering the current 1.85 per cent cash rate could be near 4.0 per cent by the middle of next year. Banks have sharply raised borrowing costs on new fixed-rate mortgages and tightened lending standards.