This archive report was first published on 24 September 2021.
Published on September 24, 2021, the IMF warned that Australia's housing market is experiencing a 'turbocharged' boom, with prices rising despite the COVID-19 pandemic.
The IMF's periodic review of Australia's economy highlighted concerns about affordability and financial stability, citing surging housing prices as a major issue.
According to data from CoreLogic, nationwide home prices have risen by over 18% in the past year, with prices in Hobart, Tasmania increasing by 25%.
Meanwhile, Sydney home prices have risen by around Aus$1,200 (US$875) per day over the past three months, with the average house price in the city now exceeding US$1 million.
The IMF attributed the boom to buyers taking advantage of low mortgage rates and fiscal support programs, but warned that high debt-to-income mortgages are on the rise and investor demand is increasing.
The Reserve Bank of Australia's benchmark rate is currently at 0.1 percent and is forecast to remain low into 2024, fueling concerns about debt levels and a potential housing bubble.
