The boss of Australia\u2019s largest bank predicts the nation\u2019s housing market will bottom out \u201cwell into 2027\u201d as rate rises and tax changes plague the property sector.<\/p>\n
Property prices have fallen for six consecutive months after the cash rate was lifted four times this year and Labor announced tax changes that have discouraged investors.<\/p>\n
Values are down 5.2 per cent on their March peak, according to data firm Cotality, with Sydney and Melbourne experiencing the steepest declines.<\/p>\n
Commonwealth Bank of Australia CEO Matt Comyn said property prices were yet to \u201cbottom out\u201d.<\/p>\n
\u201cIt\u2019s hard to be precise but I certainly would expect it to be well into 2027,\u201d Mr Comyn told ABC Radio.<\/p>\n
He noted the impact this has on household wealth, but stressed there had been similar declines in recent history.<\/p>\n
\u201cIt\u2019s also worth saying that you know, of course, people watch house prices very closely \u2013 it\u2019s the majority of Australian household assets and wealth,” Mr Comyn said.<\/p>\n
\u201cHouse prices fell by just over eight per cent in 2022-2023 on a national basis, and of course would be up something in the order of 60 per cent over seven years.\u201d<\/p>\n
Commonwealth Bank economists predicted a fall of about nine per cent in property prices before the September hike.<\/p>\n
Mr Comyn said the major bank still backs this forecast but noted it would depend on future rate decisions from the Reserve Bank of Australia.<\/p>\n
\u201cThat\u2019s still the published forecast. But they would also be looking to see if, at the moment, they still have rates on hold from this point,\u201d he said.<\/p>\n
The CBA boss said the bank\u2019s forecast will be revisited after the publication of quarterly inflation data.<\/p>\n
\u201cI think that most likely that will be reviewed around the November timeframe,\u201d he said.<\/p>\n
Major capital cities saw property values dive last month with Brisbane prices crashing the most at 1.5 per cent.<\/p>\n
Sydney followed with a 1.4 per cent fall while Adelaide and Perth experienced a 1.3 per cent and 1.2 per cent drop respectively.<\/p>\n
Cotality\u2019s research director Tim Lawless said almost no suburbs in major capital cities were immune from the decline.<\/p>\n
\u201c97 per cent of capital city suburbs were down in value over the three months to end of September, highlighting the broad-based scope of this negative housing cycle,\u201d Mr Lawless said.<\/p>\n
It comes as investors are discouraged by Labor’s plan to limit negative gearing to new builds and properties purchased before budget night.<\/p>\n
They are also disheartened by the government\u2019s plans to slash the 50 per cent capital gains tax discount and replace it with an inflation-adjusted model with a minimum 30 per cent tax rate.<\/p>\n
Read related topics:Housing Crisis<\/a>Interest Rates <\/a><\/p>\n","protected":false},"excerpt":{"rendered":"The boss of Australia\u2019s largest bank predicts the nation\u2019s housing market will bottom out \u201cwell into 2027\u201d as…\n","protected":false},"author":2,"featured_media":919062,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11],"tags":[64,63,99,21976,28044,164,11152,63069,4686,19604,1003],"class_list":["post-919061","post","type-post","status-publish","format-standard","has-post-thumbnail","category-economy","tag-au","tag-australia","tag-business","tag-cba","tag-commonwealth-bank-of-australia","tag-economy","tag-housing-market","tag-matt-comyn","tag-property","tag-property-prices","tag-real-estate"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts\/919061","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=919061"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts\/919061\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/media\/919062"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/media?parent=919061"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/categories?post=919061"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/tags?post=919061"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}