Premium market declines
With oil prices up another 6½ per cent to $107 and interest rates looking sure to move higher, asset prices look set to take a hit.
It's tricky to know where to invest funds when home prices are falling and stock markets look a bit toppy.
Brilliant work from Cotality below maps out the housing market downturn by capital city and price tier.
Higher valued houses in Sydney ($2 million plus) and Melbourne have already experienced declines of more than 10 per cent.
The top end of the market is thinner and illiquid, and tends to be more volatile, both in booms and busts.
Lower valued properties and homes in other capital cities have seen only modest price corrections to date.
Source: Cotality
For what it's worth,
Ray White reports that they're starting to see a turnaround in the premium sector of the market.
Sydney has already seen a large drop of new listings of almost -20 per cent versus the prior year.
Source: Cotality
Rents increased by 5.7 per cent over the year to August, taking gross rental yields up to the highest level since 2019.
However, as mortgage rates increase, yields remain far too low for investors to become interested in the market under today's tax settings.
Source: Cotality
You can download the full Cotality chart pack and commentary
here.
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