Why house prices are starting to fall

Big interest rate rises since May 2022 have finally seen house prices begin to drop in our most populous cities.  In the latest Corelogic data for October, Sydney home prices fell 0.1% in a month, while Melbourne was 0.2% down.  It’s still a mixed picture across the country, with national home values up 6% for the year, 1.9% down in Melbourne, 3.7% up in Sydney and a massive 22.6% rise in Perth.  With home price rises slowing in some cities, how long will that slump continue and what happens when interest rates begin to fall? Today, the ABC’s Chief Business Correspondent Ian Verrender explains why home buyers should not get too excited about falls.   He says that despite slight declines, prices remain near record levels in many areas.  Ian Verrender discusses the impact of population growth on housing demand and the challenges of affordability due to stagnant wages and rising costs.  He also says that any future interest rate cuts could quickly reignite demand, potentially pushing prices higher again.  Featured:  Ian Verrender, ABC Chief Business Correspondent Key Topics: Interest rates House price trends Corelogic data Housing affordability Population growth Housing supply and demand Sydney and Melbourne housing markets Perth housing market