Australian house prices declined for the first time in 22 months last month as buyers increasingly found themselves priced out of the market, while the supply of properties increased.
The Home Value Index for major cities slid 0.2 percent for its first fall since February 2023, property consultancy CoreLogic Inc said yesterday. Melbourne and Sydney, the two biggest markets, led the declines with drops of 0.7 percent and 0.6 percent respectively.
On the other side of the country, Western Australia’s state capital Perth led gains with a 0.7 percent increase, followed by the southern city of Adelaide, up 0.6 percent. Those two cities also recorded the largest annual gains of 19.1 percent and 13.1 percent respectively. Yet even here the pace of appreciation had slowed in recent months.
Photo: Bloomberg
“Growth in housing values has been consistently weakening through the second half of the year, as affordability constraints weighed on buyer demand and advertised supply levels trended higher,” said CoreLogic research director Tim Lawless said.
“With worsening affordability constraints and reduced borrowing capacity, we have seen buyer demand pushed toward lower-priced markets,” he said.
Higher interest rates, a shortage of homes and booming population growth have triggered a housing crisis in parts of Australia. The problem has been particularly acute in Sydney where buyers are being priced out of the market given an average home costs 13 times income.
Yet costs have now reached such a level that, combined with interest rates at a 13-year high of 4.35 percent, buyers are simply unable to raise the funds required to purchase a home. As a result, rents have also soared, though that market also ended the year on a softer note, CoreLogic said, citing a rise in the size of households in major cities and a cooling in migration.
“The final months of 2024 have set the framework for a soft start to 2025,” CoreLogic said. “However, as with 2024, we could likely see another year of multi-speed conditions, with the potential for a modest rebound in value growth once interest rates start coming down.”
CHIP WAR: Tariffs on Taiwanese chips would prompt companies to move their factories, but not necessarily to the US, unleashing a ‘global cross-sector tariff war’ US President Donald Trump would “shoot himself in the foot” if he follows through on his recent pledge to impose higher tariffs on Taiwanese and other foreign semiconductors entering the US, analysts said. Trump’s plans to raise tariffs on chips manufactured in Taiwan to as high as 100 percent would backfire, macroeconomist Henry Wu (吳嘉隆) said. He would “shoot himself in the foot,” Wu said on Saturday, as such economic measures would lead Taiwanese chip suppliers to pass on additional costs to their US clients and consumers, and ultimately cause another wave of inflation. Trump has claimed that Taiwan took up to
A start-up in Mexico is trying to help get a handle on one coastal city’s plastic waste problem by converting it into gasoline, diesel and other fuels. With less than 10 percent of the world’s plastics being recycled, Petgas’ idea is that rather than letting discarded plastic become waste, it can become productive again as fuel. Petgas developed a machine in the port city of Boca del Rio that uses pyrolysis, a thermodynamic process that heats plastics in the absence of oxygen, breaking it down to produce gasoline, diesel, kerosene, paraffin and coke. Petgas chief technology officer Carlos Parraguirre Diaz said that in
Japan intends to closely monitor the impact on its currency of US President Donald Trump’s new tariffs and is worried about the international fallout from the trade imposts, Japanese Minister of Finance Katsunobu Kato said. “We need to carefully see how the exchange rate and other factors will be affected and what form US monetary policy will take in the future,” Kato said yesterday in an interview with Fuji Television. Japan is very concerned about how the tariffs might impact the global economy, he added. Kato spoke as nations and firms brace for potential repercussions after Trump unleashed the first salvo of
SUPPORT: The government said it would help firms deal with supply disruptions, after Trump signed orders imposing tariffs of 25 percent on imports from Canada and Mexico The government pledged to help companies with operations in Mexico, such as iPhone assembler Hon Hai Precision Industry Co (鴻海精密), also known as Foxconn Technology Group (富士康科技集團), shift production lines and investment if needed to deal with higher US tariffs. The Ministry of Economic Affairs yesterday announced measures to help local firms cope with the US tariff increases on Canada, Mexico, China and other potential areas. The ministry said that it would establish an investment and trade service center in the US to help Taiwanese firms assess the investment environment in different US states, plan supply chain relocation strategies and
RSS