Morgan Stanley expects national house prices to fall 10-15% from their peak, with a trough in the second half of 2027, driven by curbs on negative gearing and the capital gains tax discount in the May budget. Dwelling prices have already dropped 5.2% since a March peak, according to Cotality, and the bank says the slide could be only one-third complete. Interest rates remain the key sensitivity, with the Reserve Bank having raised rates four times in 2026 and markets pricing in at least one more hike. If it plays out, this would be Australia's largest nominal housing downturn in over 40 years, with unemployment potentially rising to 5.1% as construction, about nine per cent of employment, slows. Construction costs rose 3.2% in the 12 months to September, and Australia is about 124,000 homes behind its goal of 1.2 million new homes in five years.
Summary written by Upside AI from the original article. Read the source for full details.
Read the original on thecourier.com.au ↗
Keywords
housingreal estateinterest ratesRBAAustralia
Open a keyword to see other news on the same topic.
Related tickers and likely impact
AUD/USD
▼ Likely negativeRelevance: low
| Market | Currencies |
|---|---|
| Close on 10/20/2026 | 0.70040 |
| Change that session | +0.35% |
Impact is scored by AI from the headline and may be wrong. It is not investment advice.
Related news
- House prices plummet as Labor points to bigger picture
Australian house prices fell a record 4.7% in the September quarter 2026, according to Domain, with every capital city recording a drop for the first time in 15 years. Perth had the steepest fall at 7.4%, while Sydney's median fell to $1.66 million, a two-year low. Economists have largely blamed the Reserve Bank's rate hikes, which took the cash rate to a 15-year high, as Labor's tax changes do not take effect until July 2027. Housing Minister Clare O'Neill described the downturn as cyclical and defended the government's policies, while Domain's Nicola Powell said prices could keep falling for months and confidence is unlikely to recover until interest rates are cut, possibly late next year.
- House prices plummet as Labor points to bigger picture
Australian house prices fell a record 4.7% over the September quarter, according to Domain's report, with prices down in every capital city for the first time in 15 years; Perth had the sharpest drop at 7.4%. Sydney's median house price fell 4.7% to $1.66 million, a two-year low, while Melbourne recorded its largest quarterly fall in four years. Housing Minister Clare O'Neill described the movement as part of the market's cyclical nature, while economists have largely attributed the falls to the Reserve Bank's rate hikes to a 15-year high; the government's tax changes do not take effect until July 2027. Domain's chief residential economist Nicola Powell said prices could keep falling for months, as buyer confidence is unlikely to recover until interest rates are cut, a prospect she sees in the latter part of next year.
- House prices plummet as Labor points to bigger picture
Domain's September Quarter 2026 House Price report shows house prices fell across every capital city for the first time in 15 years, the second time ever, with a record 4.7 per cent national drop over the quarter. Perth recorded the sharpest fall at 7.4 per cent, while Brisbane and Adelaide also logged their steepest falls on record. Sydney's median house price fell 4.7 per cent to $1.66 million, a two-year low, and Melbourne posted its largest quarterly fall in four years. Housing Minister Clare O'Neill said the movement reflected the cyclical nature of the market, while economists largely attributed the falls to the Reserve Bank lifting the cash rate to its highest level in 15 years, since Labor's tax changes do not take effect until July 2027. Domain's Nicola Powell said prices could keep falling for months, with confidence unlikely to recover before a rate cut, which she expects in the latter part of next year.
- House prices plummet as Labor points to bigger picture
Australian house prices fell a record 4.7% in the September quarter, with every capital city declining for the first time in 15 years, according to Domain. Perth recorded the sharpest drop at 7.4%, while Sydney's median price fell to $1.66 million, a two-year low. Housing Minister Clare O'Neill said the movement reflected the market's cyclical nature and called comparing only the last six months unfair. Economists have largely blamed the falls on the Reserve Bank's cash rate hikes to a 15-year high, as the government's tax changes do not take effect until July 2027. Domain's Nicola Powell said prices could keep falling for months, with buyer confidence unlikely to recover until interest rate cuts arrive, perhaps late next year.
- House prices plummet as Labor points to bigger picture
Domain's September quarter 2026 report shows house prices fell in every Australian capital for the first time in 15 years, with a record national drop of 4.7% over the quarter. Perth had the steepest fall at 7.4%, while Sydney's median house price slipped to $1.66 million, a two-year low, and Melbourne recorded its largest quarterly fall in four years. Housing Minister Clare O'Neill described the downturn as part of the market's cyclical nature, noting that the government's tax changes do not take effect until July 2027. Economists have largely blamed the falls on the Reserve Bank's rate hikes to a 15-year high. Domain's Nicola Powell expects prices may keep falling for months, with buyer confidence unlikely to recover until interest rates are cut, a prospect she sees in the latter part of next year.
- House prices down in all Australian capitals in 15-year first
According to Domain's third-quarter 2026 report, house prices fell in the capital cities of all eight states and territories for the first time in 15 years, with the combined capital-city median house price down a record 4.7%. Median unit prices fell 3.5%, the second straight quarter of declines for both property types, and annual growth turned negative for the first time in over three years. Perth had the largest falls, down 7.4% for houses and 6.5% for units, while Sydney's median house price hit a two-year low. Domain attributed the downturn to weaker buyer confidence from higher interest rates, cost-of-living pressures and the federal government's move to wind back tax concessions for investors. The Reserve Bank raised the cash rate target to a 15-year high of 4.60%, and will next meet in early November.
Related markets
Latest news
- Bank Profits Surge
The 9-month 2026 results show many banks continued to grow profits, with some posting record quarterly earnings. VPBank's pre-tax profit reached nearly VND 30,000 billion, up nearly 47%, equal to its full-year 2025 result and about 72.4% of its 2026 plan; Q3 pre-tax profit topped VND 11,000 billion. Techcombank posted VND 28,900 billion (up 23.7%), while LPBank reported VND 10,421 billion (up nearly 9%). SSI forecasts pre-tax profit of its monitored banks to rise 19.5% in 2026 before slowing to 15.4% in 2027, pressured by narrowing net interest margins and rising credit risk provisions. It also expects system-wide credit growth of 16-17% in 2027 and 17.9% for the monitored banks.
- World's Largest Gold Fund Dumps Over 10 Tonnes of Gold as Prices Slide
SPDR Gold Trust, the world's largest gold fund, continued net selling of nearly 12 tonnes of gold in the 22/10 session, bringing total sales over 2 sessions to nearly 15 tonnes and cutting its holdings to about 1,046 tonnes. Spot gold fell more than 2.8% to around USD 4,025 per ounce at the close of 22/10, and briefly dipped below USD 4,000 per ounce in the morning session of 23/10. Tensions in the Middle East pushed crude oil prices higher, raising concerns about inflation and further Fed tightening, and gold has still not attracted sustained safe-haven demand even as US Treasury yields fell. US September CPI rose 0.6% month on month and 3.7% year on year, while PPI rose 1.3% and 6.3%. Markets price about an 84% chance the Fed holds rates steady at its 27-28/10 meeting and a 16% chance of a 25 basis-point increase; September PCE data due on 29/10 is the next key factor to watch.
- Gold Prices Continue to Fall
On the morning of 23/10, domestic gold prices kept falling, with SJC bar prices varying by seller and the premium over world gold widening. Công ty TNHH Vàng bạc đá quý Sài Gòn listed SJC bars at VND 139-142 million per tael (buy-sell), down VND 300,000; Phú Quý was at VND 138-141.8 million, down VND 500,000; and Mi Hồng at VND 140-141.5 million, down VND 800,000. Gold rings also fell by varying amounts, with DOJI at VND 138-142 million and Phú Quý at VND 138-141 million per tael. World gold dropped USD 129 to around USD 3,992 per ounce, equal to about VND 125.3 million per tael, leaving SJC bars about VND 16.7 million per tael above the world price. The State Bank's central rate was set at 25,627 VND/USD, down 5 dong, while Vietcombank quoted 25,660-26,040 VND/USD (buy-sell).
- Company Linked to Billionaire Pham Nhat Vuong Announces Major Good News
VEFAC (ticker VEF), a Vingroup subsidiary, posted Q3 net revenue of nearly VND 77 billion, up 67% year on year, but a gross loss of about VND 27 billion as cost of sales from its exhibition business exceeded revenue. Q3 profit rose mainly thanks to a gross gain of about VND 65 billion from transferring some schools in a project to a partner, while financial income reached over VND 388 billion, mostly from loan and investment income. For the first nine months of 2026, after-tax profit was nearly VND 865 billion, down about 94% from VND 15,418 billion in the same period of 2025, as the prior year included large gains from transferring part of the Vinhomes Global Gate project. As of 30/9/2026, total assets stood at over VND 31,905 billion, up 36% from the start of the year, while total liabilities exceeded VND 24,364 billion, with short-term customer advances rising from VND 411 billion to over VND 8,373 billion.
- Lotte and Phat Dat Officially Break Ground on VND 60,000 Billion Mega Project in Thu Thiem 'Golden Land'
A joint venture between Lotte Group (South Korea) and Phát Đạt (HoSE: PDR) officially broke ground on 23/10 on Lotte Eco Smart City Thu Thiem in the Thu Thiem New Urban Area, HCMC, with total investment of about VND 60,000 billion. The project covers nearly 7.5 ha and will combine Grade A offices, retail, services, accommodation and housing, adjoining the central plaza and central lake of Thu Thiem. Phát Đạt holds 35% of Lotte Properties HCMC, the project developer, and will develop the housing blocks along with two towers (2-1 and 2-3) with about 219,722 m2 of floor area, while Lotte handles block 2-5. Lotte Properties HCMC paid VND 17,569 billion in land-use fees on 31/7/2026, and Phát Đạt completed its VND 7,666 billion payment to take its 35% stake. MB is funding all of Phát Đạt's capital contribution, while VietinBank and BIDV also support the project.
- International Business : Global stocks nosedive as Meta dents AI optimism
Global stocks retreated as tech earnings failed to ease concerns about the AI outlook, with MSCI's All-World index set for its largest daily fall in two weeks, down 0.4 per cent. Meta beat third-quarter revenue expectations, but its plan to issue non-voting stock revived worries about its mounting capital commitments, and a New Mexico judge ordered it to pay a $25 billion penalty in a data privacy case. Brent crude rose nearly 3% to $112 a barrel, near a five-month high, after more Houthi attacks in Saudi Arabia raised supply risks. Investors moved into government bonds, pushing the US 10-year yield down to 5.05%, below France's for the first time in 13 years, while French yields have climbed above 5% amid concerns over social unrest and debt. The France-Germany 10-year spread reached 177.7 basis points, its widest since 2011, while gold fell 1.8% to $4,070 an ounce.
Get the briefing on Telegram or Zalo
Join the Upside Telegram channel or Zalo group for the Vietnam stocks and gold briefing at 8:00 and 19:00 (Vietnam time) on trading days, plus a weekly wrap on Saturday morning.