Australia is experiencing its most severe housing crash on record, according to data shared by Coolabah Capital’s Chris Joye. The current decline in dwelling values is officially the worst since 1980, with national capital city prices falling at a 16% annualized pace over the last three months, based on Cotality data.
The current 7.6% drop from the March 2026 peak surpasses the previous record of a 7.0% decline during 2022-23, which followed aggressive interest rate hikes by the Reserve Bank of Australia (RBA) post-pandemic. The worst recorded decline in Cotality’s data was 8.6% between November 2017 and May 2019.
With dwelling values down 4.2% over the past quarter in the five main capital city markets, analysts predict the record peak-to-trough decline will be broken by late November, potentially reaching a 10% decline by the end of the year. The outlook for 2027 is grim, as further RBA interest rate hikes and rising unemployment above 5% are expected to reduce housing demand and force more distressed mortgage holders to sell.
Despite the bleak forecast, there is some public support for lower home prices. Peter Tulip noted in response to Joye’s tweet that 61% of Australians surveyed support the objective of bringing house prices down. The coming months will test the strength of this support as the housing market continues to deteriorate.