NAB forecasts 2% fall in capital city house prices this year
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The news: NAB has revised its forecast for housing prices across Australia’s eight capital cities, predicting a 2% decline this year, led by falls of 6% to 7% in Sydney and Melbourne.
The bank said recent changes to capital gains taxes and negative gearing have reduced incentives for property investment on the back of a higher interest rate environment.
The context: According to NAB’s latest market research, dwelling price growth was already slowing ahead of the May federal budget and has continued to soften, with prices flatlining in May, marking the weakest monthly outcome since late-2024.
The moderation was driven by Sydney and Melbourne, where dwelling values fell 0.9% and 0.8% month-on-month respectively.
Despite the slowdown, dwelling prices remained 8.8% higher than a year ago, with the national median dwelling value sitting at around $940,000.
The source: NAB research
