Australian home values are in freefall as clearance rates drop | Sunrise

Like pain and post -budget nerves are having a big impact on property, the number of homes being sold at auction has fallen to its lowest level since the early days of COVID.And that number is only getting lower.In Brisbane, for example, last week, the clearance rate was at 42%.Now it's dropped all the way down to just 30%.33%.For their take, let's bring in Social Services Minister Tanya Plibersek and Nationals leader Matt Canavan.

Morning to both of you.So Sydney house prices have also come down an average of $75 ,000.That's in the past three months.Tanya, we know the government wants to make houses more affordable for young Australians.Are you happy with this price drop or do you want to see them fall further?

Well, what we anticipate over time is not that house prices will continue to fall, but that they will grow more slowly.House prices have been growing too fast, and that's meant that young Australians haven't been able to afford a home of their own.We're parents.I've got three kids.Matt's got five.I know you've got a couple of kids as well, Nat.

We want them to be able to afford a home of their own one day.And house prices have grown by about eight and a half times It used to be that the average house cost about four years of the average wage.Now it's about eight and a half years of the average wage.People just can't keep up with that because they've been competing with property investors for those houses.So now we say you'll still be able to negatively gear if you're doing it at the moment on an existing property.If you want to negatively gear in the future, you'll have to invest in new build housing stock.

And that's what will give young Australians a chance to buy a home of their own.That and our 5 % deposit policy which has helped well over a quarter of a million people now into a home of their own.

You want them to grow more slowly but in fact they're going down.So you're happy with that?How far do you want them to go down?

Well, what we expect over time is that they'll grow more slowly and they'll remain more affordable.

But grow more slowly is still going up.But they're going down.Do you want them to go down further?

It depends which city you're looking at.

I don't think they're going up anywhere except slightly in Perth and slightly in Brisbane.

No, they're going up slightly in different cities and that's actually a slow growth, a moderate growth that people can keep up with.That's what we expect will happen over time.

But they're still so high, young people can't afford them.So if they go up any more, young people still can't afford them can they?

Yeah, that's why we've also got our 5 % deposit policy which has helped well over a quarter of a million households.into a home of their own now.It's why we've got a $47 billion package where we're, for example, working with the states and territories and local government to provide the infrastructure that we need in new housing estates to make those homes more affordable.It's why we're working so closely with state governments for them to reform their planning systems, because we know that at local government level and state government level, that's where a lot of the delays are, and that's where a lot of the costs are.So it's not one thing that we're doing.housing more affordable in a range of different ways.

Because in Australia, where people can afford to own their own home, that is a real fundamental part of our vision.

Everyone wants young kids to be able to afford their own home.Well, do they?

Then why are the Liberals voting against it?

We're actually making changes.Let's go to Matt.There is some support for the drop in prices.A survey in the Sydney Morning Herald shows 54 % of voters back some level of lower house prices.Do you want house prices to drop, Matt, or as Tanya said, do you want growth to become slower?

We've got to make them more affordable.And look, I feel sorry for Tanya.She's not the author of this budget mess and she's doing her best there to defend it now.But what we need to do is make some homes more affordable.So the price we see is just the average price.I don't want to see house prices fall across the economy, but I want to see house prices at the lower end of the market with more supply, more affordable housing and more affordable locations increase.

That doesn't necessarily mean that people who own existing houses see their prices fall.But what this government has engineered is an economic crash, a crash in economic confidence which is seeing auction rates at record lows.by Jim Chalmers has effectively driven our economy, like Thelma and Louise, over a cliff.And it's falling down at a rapid rate now.The government needs to do something to restore confidence.They ripped up half their budget last week.

That's not enough.I mean, everyone wants to fire the liar.But what we've really got to do is drop the flop.Jim Chalmers' budget is a total flop.The Prime Minister should sack him, get someone in there who actually can come up with an economic plan for our country.Because the biggest problem with what's going on in the last few months is that confidence is now cratering.

and that hurts our entire economy and yes that will lower house prices but lots of us will be left without a job as well and that's not good for everybody.No, well, I don't care what it is, I want to get rid of this government because they are hopeless.Under this government, we've seen real wages drop back to 2011 levels.That's what's stopping our children being able to afford a home.Under this government, productivity has fallen for the first time in over a four year period ever.It's never happened.

They did set one record on even that.

Matt, are you sharing notes with One Nation?

I just want to see this Government go, I'll work with anybody, I'll work with anybody guys, I'll work with anybody to get rid of this terrible Government, but we should drop the flop, this guy, this Treasurer should go.

Okay Matt can I just clarify so you want some areas of the house market to fall is that like the lower market like under a hundred under 1 .5 million say so people can afford it?

No it's not about them falling that it's about making sure the distribution of housing.So you don't want house prices to fall?No I don't want to see because that's the most important asset in Australian's balance sheet but we can make housing more affordable if we create more housing, if we create more supply.Because if you bring on more properties at the lower end of the market, there'll be more housing available, people can buy more stuff.But the more supply and demand, basic economics, more supply, the market will drop.

The prices will go down.

But everybody doesn't...But then there are other things, yes, but Nat, then you need an economy that's strong and that will lift prices for everybody as well in those upper end of the market, right?So you can, you can have an economy where all boats rise as long as you have a government that has an economic plan to lift productivity, to increase wealth, economic growth.One of the worst parts of the budget is there's no, there's no, I want to see more housing at that affordable part of the market.The problem is the, The problem is there's not those houses available for those first home buyers.

But at the same price.So if you can't afford a house now, you won't be able to afford a house if there's more in the market, unless they go down.

So the real difference, Matt...

Sorry, Matt, continue.

Sorry, who do you want, Matt?Do you want me to talk?

If you just want more houses available, Matt, you want more houses available in the lower end of the market, but you want them at the same price as they are today.

Well, if those prices are low enough, that will be affordable for Australians, particularly if we have a strong economy and a government with a plan to grow that economy.This government doesn't have a plan.There's no economic plan for economic growth.There's no plan to lift productivity growth given that we have the lowest productivity growth record in history, in our history.And the government has no plan for that.That's the fundamental problem in our economy.

Tanya, last word for you.Well, last word, same thing from Matt.He's voting against more affordable housing, he's voting against tax cuts for Australian workers, 13 million of them, in the legislation that's before the Parliament.

No we're not, that is a total lie.

You're going to vote against that in the Senate, Matt?People are sick of these lies, you're lying all the time.Are you going to vote for the tax cuts, are you?You're going to vote for the housing changes and the tax cuts?

We are separating those parts of the bills and voting for them, you know that.You know that, people are sick and tired of the rubbish.Alright, we'll see whether this gets through the Senate, but Matt has no plan for housing.

He's going to do what he did at the last election, vote against affordable housing and vote against tax cuts for Australian workers.You watch that.

Okay, we'll see if that bill can be separated.Thank you very much.I'm not sure how clear that was about the housing though.Thank you, we'll see you next week.