Graham Cooke, head of consumer research at Finder, said a seventh consecutive rate hike – 275 basis points in total – will be a tough burden for many households.
“The RBA has been crystal-clear that its top priority is to tamp down inflation. After 6 hikes, inflation is at a 30-year high. More rate rises are likely on the way.”
House prices tipped to drop up to $175,000 in capital cities
The majority of panellists who weighed in predict a price drop for houses across all capital cities.
Sydney is projected to suffer the biggest drop of 13.4% from its peak, a loss of $174,200 off the median property.
Melbourne is not far behind, with experts predicting a 12.9% drop for a loss of $116,100 in value.
Cooke said he thinks the panel’s predictions for house price drops in Sydney are actually optimistic.
“We’ve already seen more than 10% wiped from housing values in some areas since the peak, and the cash rate will just keep climbing.
“It’s a worse-case scenario, but price falls of up to 25% would not be unrealistic.”
Houses in Hobart and Canberra are tipped to lose 9.8% and 9.5%, while the other capital cities are looking at drops between 9% and 9.4%.
“If lessons are to be learned from similar price falls in places like Ireland post GFC, the outer suburbs and apartments will be the hardest hit, and the slowest to recover,” Cooke said.
Full article: Finder
