Cancel the fireworks, because UBS says Australia’s world record housing boom is officially over.
“There is now a persistent and sharp slowdown unfolding, ending 55 years of unprecedented growth that has seen home values soar by more than 6,500 per cent,” economists from the global investment bank wrote in a note to clients on Thursday.
Following new regulations and tighter lending requirements, home prices in capital cities have slowed down and in Sydney home prices have dropped for two consecutive months and a total of –0.6% for the quarter.
Melbourne has been more robust than Sydney, with prices increasing almost 2% this quarter according to Core Logic.
Meanwhile, Hobart has surged ahead with a 3.3% increase in values in the quarter.
Canberra (+1.1%), Brisbane (+0.6%) and Adelaide (+0.1%) rounded out the middle, but Perth (-0.7) and Darwin (-4.4%) continue to fall.
UBS noted that the cooling may be happening even faster than they expected and has downgraded the national growth forecast for 2017 to just 5%.
For contrast, national house price growth was almost 11% in 2016.