Australia’s housing boom is “officially over,” with data showing prices now flatlining, UBS Group AG said. National house prices were unchanged in October from September, CoreLogic data released Wednesday showed. Annual price growth slowed to 7 percent last month from above 10 percent as recently as July, the data showed.
“There is now a persistent and sharp slowdown unfolding,” UBS economists led by George Tharenou said in a report. “This suggests a tightening of financial conditions is unfolding, which we expect to weigh on consumption growth via a fading household-wealth effect.”
An end to Australia’s property boom will be welcome news for first-time buyers, who have struggled to break into the market after surging prices propelled Sydney past London and New York to be the second-most expensive housing market. Less impressed may be property investors, already squeezed by regulatory lending curbsthat drove up mortgage rates. (Bloomberg)