House prices are falling, but first home buyers like Grace say corrections haven't helped
SBS News
β’Sat, 8 Aug 2026 02:51:56 +0000
π° What Happened
Australian house prices are falling, with capital cities expected to drop 5 per cent across 2026, but repeated Reserve Bank interest rate hikes have cut the average borrower's purchasing power by about $35,400. First home buyer Grace, 29, from Wollongong, found that even with prices lower, homes in her own city remain beyond budget. She and her partner say they are now looking further south where prices are more in range.
π The Backstory
Australia's housing market has been cooling even as the RBA has kept rates high, and the market is expected to reach a historical low this year. Falling prices have not offset the dual squeeze of higher mortgage costs and tighter borrowing limits on first-time buyers.
π― Why It Matters
Whether the property correction actually helps first home buyers is a question affecting a generation's ability to enter the market. The story shows that headline price falls don't automatically translate into affordability for ordinary Australians, informing expectations for anyone planning to buy.
Australian house prices are falling, with capital cities expected to drop 5 per cent across 2026, but repeated Reserve Bank interest rate hikes have cut the average borrower's purchasing power by about $35,400. First home buyer Grace, 29, from Wollongong, found that even with prices lower, homes in her own city remain beyond budget. She and her partner say they are now looking further south where prices are more in range.
Australia's housing market has been cooling even as the RBA has kept rates high, and the market is expected to reach a historical low this year. Falling prices have not offset the dual squeeze of higher mortgage costs and tighter borrowing limits on first-time buyers.
Whether the property correction actually helps first home buyers is a question affecting a generation's ability to enter the market. The story shows that headline price falls don't automatically translate into affordability for ordinary Australians, informing expectations for anyone planning to buy.