As commentators and banks alike continue to revise housing price forecasts down, Australians are increasingly wondering how much further prices could fall.
With the release of the latest revised housing price data from Cotality, it can now be confirmed that housing prices are falling significantly faster than initially believed, particularly in the locales worst impacted by revisions.
There are often calls for more coverage of markets beyond Sydney and Melbourne, so today we have the full set of charts on housing prices since their peak and the impact of recent revisions across all locales covered in Cotality’s Daily Index.
Amidst the deteriorating trend for capital city housing prices, they are now roughly three-quarters of the way to the largest price falls in 40 years.
The largest downward revisions were in Perth, where total price falls went from -4.5% on the 28th of September to -6.15% on October 1st.
The next largest downward revision was seen in Brisbane, which encompasses the Gold Coast, which saw price falls shift from -4.0% in one of the last September snapshots to -5.25% in the revised data on October 1st.
From here, the magnitude of revisions shifts dramatically lower, with Sydney’s 1st of October snapshot 0.3% lower than the one from the 28th of September.
Revisions in Adelaide are smaller again, with price falls of only 0.16%.
Bringing up the rear is Melbourne, which saw the most minor shift of all, moving by barely 0.1 of a percentage point.
The Takeaway
Amid a still-deteriorating market, it is worth approaching housing price data with caution, knowing that the magnitude of house price falls could be revised down significantly at the start of the following month.
Normally at this point in the cycle, lower rates or government intervention to support the market is rarely too far away, but this time interest rates have recently been raised and are priced to head higher, and scope for intervention by fiscal policymakers is more limited than in past cycles.
For this reason, housing prices may not only keep falling, but the daily declines we see may be revised to reflect an even larger drop.
