Surging Prices at the Lower End: Experts Warn of a Housing 'Up-Crash'
Desperate first-time homebuyers are fueling rapid price increases in smaller capital cities, despite rising interest rates, as they compete against investors undeterred by potential tax changes.
The housing market in Australia is witnessing a remarkable phenomenon, as desperate first-home buyers are driving up the prices of more affordable properties despite the ongoing interest rate hikes. Economists are warning of a relentless housing 'up-crash' in the lower end of the market, as buyers face fierce competition from investors who have continued to borrow heavily despite government warnings about potential tax discounts and deductions.
The latest data shows the biggest house price increases in February have occurred in smaller capital cities, as buyers remain undeterred by the interest rate rises. This surge in demand for cheaper homes has powered a relentless rise in prices, even as the Reserve Bank of Australia (RBA) continues to raise rates in an effort to cool the overheated market.
Source: The Guardian
