House prices in Australia fell for the third consecutive month in July. In Sydney, prices had their biggest drop in almost 40 years, according to Reuters.
The fall is due to rising borrowing costs as the Reserve Bank of Australia (RBA) has raised interest rates for three months in a row to curb the country’s inflation, which is at its highest level in more than 20 years.
Nationally, prices fell by 1.3 per cent in July, down from 0.6 per cent in June. Prices were still 8 percent higher for the year, which reflects high house price growth in 2021 and the beginning of 2022, figures from the consultancy CoreLogic show on Monday.
Compared to the financial crisis
“…The decline is comparable to the onset of the global financial crisis in 2008 and the sharp decline of the early 1980s,” said CoreLogic’s head of research, Tim Lawless.
The fall was greatest in the country’s eight major cities, where prices fell 1.4 per cent in July, while annual growth slowed to 5.4 per cent after being up over 20 per cent early this year.
The decline in Sydney accelerated when prices fell 2.2 per cent in July, while those in Melbourne fell 1.5 per cent.
“In Sydney, where the decline has been particularly accelerated, we are seeing the steepest drop in value in almost 40 years,” Lawless said.
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