Antipodean Macro<\/a>, the decline in new housing loan commitments in the March quarter has occurred alongside weaker housing price growth:<\/p>\nAdvertisement<\/p>\n
![\"Housing](\"https:\/\/www.newsbeep.com\/au\/wp-content\/uploads\/2026\/05\/Mortgage-demand-and-home-prices.png\")
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More downside is still to come. Mortgage rates have yet to fully reflect the Reserve Bank of Australia\u2019s (RBA) three consecutive interest rate hikes. And the interest rate futures market forecasts that the Reserve Bank will raise rates one to two more times by the end of this year.<\/p>\n
Meanwhile, the federal budget\u2019s changes to negative gearing and the capital gains tax (CGT) are certain to lower investor demand and place downward pressure on home prices.<\/p>\n
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Indeed, the federal budget papers assume that the combined changes to negative gearing and CGT will lead to a modest, single\u2011digit decline in national home prices over the next two years \u2014 roughly 2% to 4% below the baseline forecast.<\/p>\n
The impact is front\u2011loaded, concentrated in 2026\u201327, as investor demand for existing dwellings falls.<\/p>\n
Finally, the RBA forecasts that unemployment will rise over the period ahead, which will, other things equal, lower housing demand.<\/p>\n
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The most significant price decline recorded by Cotality over the past 40 years was\u00a0in 2017-19, when values fell by 8.2% amid credit tightening following a period of solid growth. Values also fell by 8.1% over 9 months in 2022-23 as interest rates rose from emergency lows post-pandemic:<\/p>\n
![\"Cotality](\"https:\/\/www.newsbeep.com\/au\/wp-content\/uploads\/2026\/05\/Cotality-house-price-declines.png\")
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Source: Cotality<\/p>\n
Given the Australian housing market\u2019s record overvaluation relative to incomes and the headwinds cited above, values look poised to record their largest decline in at least 40 years.<\/p>\n
Advertisement<\/p>\n","protected":false},"excerpt":{"rendered":"Australia\u2019s housing market is entering a bear market driven by Sydney and Melbourne. Price growth has stalled, and…\n","protected":false},"author":2,"featured_media":669644,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11],"tags":[64,63,99,164],"class_list":["post-669643","post","type-post","status-publish","format-standard","has-post-thumbnail","category-economy","tag-au","tag-australia","tag-business","tag-economy"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts\/669643","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/comments?post=669643"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts\/669643\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/media\/669644"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/media?parent=669643"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/categories?post=669643"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/tags?post=669643"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}
![\"Cotality](\"https:\/\/www.newsbeep.com\/au\/wp-content\/uploads\/2026\/05\/Cotality-28-day-change-6.png\")
<\/p>\n![\"Sales](\"https:\/\/www.newsbeep.com\/au\/wp-content\/uploads\/2026\/05\/1778732417_991_Cotality-sales-volumes.png\")
<\/p>\n![\"Housing](\"https:\/\/www.newsbeep.com\/au\/wp-content\/uploads\/2026\/05\/Mortgage-commitments.png\")
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