A new report has confirmed Melbourne property prices are likely to fall by up to 10 per cent by the end of the year.
Melbourne’s median house price has fallen to $940,000 and this forecast means it will continue to drop by around another $90,000 in the coming months.
The PropTrack Property Market Outlook Report predicts Melbourne to be one of Australia’s hardest hit in this current 2023 downturn, after its prices fell by around 5 per cent in 2022.
The forecast is based on assumptions the Reserve Bank will lift interest rates by another 0.25 per cent before putting them on hold, but listening to governor Philip Lowe speak this week, there’s no guarantee the RBA will stop at just one more rate hike.
PropTrack economic research director Cameron Kusher told realestate.com the heat was coming out of the Melbourne market.
“I feel, once we stop getting changes to interest rates every month, it will give people more confidence,” he said.
If the PopTrack predictions come to fruition, Melbourne house prices will back to where they were just before the pandemic hit.
“Melbourne’s probably most at risk of that happening, just because prices didn’t grow as much there as elsewhere because it spent so long in lockdown,” Mr Kusher said.
Real Estate of Victoria president Andrew Meehan also spoke to realestate.com and said despite the predictions of 10 per cent drops, the property boom that came out of COVID had strengthened the market.
“The post-Covid real estate boom has placed Victorian property in a stronger position than ever before, a trend we continued to see grow in pockets of outer Melbourne and our regional areas in the last quarterly figures,” he said.