Housing downturn forecast to run up to 15 per cent

Key points

• Morgan Stanley now expects national house prices to fall 10 to 15 per cent from their peak, with a trough in the second half of 2027. The bank said this would be Australia's largest nominal housing downturn in over 40 years.
• Dwelling prices have already dropped 5.2 per cent since March, according to Cotality. Higher construction costs, rising unemployment risks and a slower building pace are also weighing on the sector.
• Construction costs rose 3.2 per cent in the 12 months to September, with plastics prices driven up by fuel costs.