Here’s what Albo and Chalmers don’t have the guts to say (but I will):
House prices are falling, and that’s a good thing.
For anyone under 40 who’s given up on ever owning a home, this is the best news since your dad stopped emailing you the auction results with “food for thought” in the subject line.
Yet for a real estate agent with an Audi lease, it’s the end of the world.
Heck, if you listen to the property industry you’d think the sky was falling.
“Worst auction day in 30 years!”
“Property panic!”
“Sharpest correction in 40 years!”
So … let’s check the scoreboard.
Over the June quarter, prices across the combined capitals slipped by just 2.5 per cent. Over the past year they’re still up 3.9 per cent, according to Cotality.
What is true is that at the moment, the market is colder than a mother-in-law’s kiss.
And if prices were to fall 10 per cent … they’d still only be back to where they were in late 2024.
Some perspective you don’t get from the outraged:
Average house prices have increased by more than 400 per cent since 2000, partly on the back of taxpayer-funded landlord welfare. They’ve grown much faster than workers wages. Which is why we’re in this pickle.
My view?
This is a correction we’ve needed for 20 years.
The government set out to make property investing less attractive, and they get the gold star.
For a new property investor, the income is less than they’d get on a savings account. The only way the sums ever worked long-term was the price going up at a constant clip. Take that away and you’re volunteering to fix someone else’s dishwasher at 9pm on a Sunday.
And the public (as usual) is streets ahead of the politicians here. A Resolve poll found 61 per cent want prices to fall. Yes, even homeowners. Which sounds kind of mad, a couple hoping their biggest asset drops in value … until you clock the 28-year-old still asleep in the back bedroom.
Somewhere along the way we started treating houses like a share price. Something to check, brag about, and borrow against. We forgot what they’re actually for.
A house is for living in.
So when the news runs around with its hair on fire about “the crash”, look at who’s actually panicking.
It’s not the young couple who might finally get a foot in the door.
It’s the bloke with the Audi lease.
Let him sweat.
Tread Your Own Path!