Key facts
- Some recent homeowners are willing to accept lower property valuations to make housing more accessible.
- Alex Hogan, 41, argues that falling prices are better than a two-tier society.
- Eibhlinn Cassidy, a junior doctor, prefers paying a mortgage over high rents.
- Remy Coll is an accidental landlord due to falling prices preventing him from selling his old home.
- Canberra's median home price has fallen $44,000 since earlier this year.
- Prices are expected to rise again once the RBA starts cutting interest rates, likely in 2028.
Falling property prices are causing financial strain for recent homeowners in Australia, yet some, like Alex Hogan and Eibhlinn Cassidy, are embracing the downturn as a necessary step towards greater housing affordability. Hogan, 41, believes that lower prices are essential to prevent a "two-tier society" of renters and landlords, even if it means personal financial pain.
House prices nationwide have declined 3.6% from their peak this year, with some analysts predicting further drops of over 10% due to higher borrowing costs and a weak economy. These falls are attributed by critics to the government's May budget reforms, which altered tax treatment for property investors. Tim Wilson, Liberal Treasury spokesman, stated that families are watching the value of their homes plummet.
Cassidy, a 30-year-old junior doctor, is stoic about potential increases in her mortgage repayments upon refinancing, preferring to own a home rather than face rising rents and weak tenant rights. She considers the current market adjustment a "small price to pay" for increased accessibility.
KPMG economist Terry Rawnsley suggests that many recent buyers may be able to weather the downturn without needing to sell, as prices are expected to recover once the Reserve Bank of Australia begins cutting interest rates, possibly in 2028. However, those refinancing soon or who bought in the last 12-18 months may experience stress.
Remy Coll, 37, has become an "accidental landlord" after being unable to sell his previous home to use as collateral for a new purchase in Canberra. The government's tax reforms, announced shortly after his purchase, have contributed to a $44,000 drop in Canberra's median home price. Coll is now managing two mortgages and renting out a property he does not wish to own, believing the government's actions were ultimately correct despite the short-term pain for some.