Australia's Housing Market Downturn: A Couple's Nightmare and a Warning for the Economy

Australia's housing market is facing a dark side as prices continue to fall. Thousands of people are cheering on falling house prices, but for one Sydney couple, it's a nightmare. They bought a $2 million property this year but are still struggling to sell their old home, leaving them stuck with two mortgages.

The couple, who are both nurses, told veteran auctioneer Tom Panos that they had slashed the asking price of their old home by 20 percent, but still couldn't find a buyer. They expressed their frustration in a message to Mr. Panos, saying 'I am in a mess now because of this Budget. I am not a greedy investor. Me and my wife are hardworking nurses. Really struggling.'

Mr. Panos said that nervous buyers were increasingly holding back amid fears prices could fall even further after the federal government's housing policies announced by Treasurer Jim Chalmers in the May Budget weakened buyer confidence.

The Reserve Bank governor Michele Bullock has warned that further increases to the cash rate may still be needed to curb inflation. Meanwhile, Mr. Panos urged the Reserve Bank not to lift rates when it meets on August 11, warning a flood of spring listings combined with higher borrowing costs could send prices even lower.