Interest rate hikes have caused dramatic plunges in house prices in what were until recently Australia’s hottest property markets, with two elite suburbs tanking by $250,000 – as experts warned worse is coming.
Median property prices collapsed by $200,000 and more in several parts of Sydney in the June quarter, with houses worst affected although unit prices tumbled too.
One leading housing economist said buyers’ borrowing capacity had been ‘eroded’ because of interest rate hikes and as rates keep climbing, prices would continue to deteriorate.
On Tuesday the reserve Bank of Australia raised the cash rate to a six-year high of 1.85 per cent, and all major banks are forecasting that rates would keep being raised for the rest of this year at least.
Interest rate hikes have caused…
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