AMP Forecasts Australian Home Values Could Fall 10–15% by Late 2027

AMP chief economist Shane Oliver expects a 10–15% peak-to-trough decline in Australian home values by late 2027, citing higher mortgage rates, changes to property tax concessions, poor affordability and weakening confidence.

The downturn is already underway. September Cotality figures cited by The Nightly show national values down 5.2% from their March peak. Sydney has fallen 8.6% from February, Perth 6% from April and Brisbane 5.4% from May.

The pressure extends beyond falling prices. Higher borrowing costs reduce purchasing power while making existing mortgages harder to service. Oliver also points to rising unemployment as a potential trigger for more distressed sales.

A 15% national decline would exceed the downturns of 1982–83 and 2017–19. It remains the upper end of AMP’s forecast, rather than an established outcome.
Our reading is that lower prices may improve entry costs, but access to finance and repayment capacity will determine how much of that improvement translates into opportunity.

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Originally posted on LinkedIn