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Falling house prices offer little relief for first-time buyers, Burg says

Cotality's research chief tells ABC News Australia that rising interest rates are eroding affordability gains, with Brisbane and Perth leading the declines.

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ABC News (Australia) Story of November 2, 2026Trari Newsroom

Why this story? One of ABC News (Australia)'s most watched videos since yesterday, with 47,931 views.

Home values on track for 'largest downfall in 40 years': Cotality | ABC NEWS

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0:38Burg identifies Brisbane and Perth as the capitals recording the fastest house-price declines.
1:05Limited homes available to buy help explain Hobart and Darwin's relative resilience, Burg says.
1:41Rising interest rates offset affordability gains from lower prices for first-time buyers.
3:07Burg forecasts the largest downturn in forty years, but says population growth and supply constraints will limit it.
3:48Another rate rise would reduce borrowing capacity and increase mortgage repayments, Burg warns.

Cheaper homes do not necessarily mean an easier path to buying one. Cotality's head of research Gerard Burg tells ABC News Australia's News Breakfast that rising interest rates are severely offsetting the benefit of falling prices for first-time buyers.

Discussing the firm's October property figures with James Glenday, Burg says Australia is heading towards an unusually deep downturn. "We are on track for the largest downturn that we've seen across the past 40 years," he says.

Brisbane and Perth are recording the fastest declines, according to Burg, with Sydney falling only a little more slowly. Melbourne's decline has eased relative to other cities, while he attributes greater resilience in Hobart and Darwin to the limited stock available to buy.

For prospective first-time buyers, the difficulty is not simply saving enough for a deposit. Higher interest rates constrain how much they can borrow and increase repayments. Burg describes these buyers as particularly exposed to rate changes and warns that another rise would add further pressure.

The interview has drawn about 48,000 views since yesterday. It follows the broadcaster's separate report on a Sydney auction that fell short, moving from one property's experience to the forces affecting buyers across the country.

Burg also identifies limits to the slump: strong population growth supports demand, while elevated construction costs and labour shortages make it difficult to add homes. Those supply constraints, he says, will help put a floor under the market.

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