Australia house prices fell the most in 16 months last month and face “significant” downside risk as mortgage holidays and government wage subsidies expire in coming months.
Property values in major cities fell 0.8 percent last month, the steepest decline since February last year, CoreLogic Inc data released yesterday showed.
The slide was led by Perth and Melbourne, which is at the center of a new spike in COVID-19 cases that has prompted the government to lock down parts of the city.
Photo: Bloomberg
“Despite the early signs of improved economic activity and a lift in housing turnover, the downside risk remains significant,” CoreLogic head of research Tim Lawless said. “The recent rise of active virus cases in Victoria is a reminder that the potential risk of a second wave remains a stark reality.”
The housing market faces a further test later this year, when current extraordinary levels of government and bank assistance start to wind down.
More than 485,000 home borrowers are on payment holidays, while about 3.5 million workers are on government wage subsidies, with both programs helping avoid the need for forced sales that could push down prices.
The wage subsidies are set to end in September, while banks might also toughen up criteria for borrowers wanting to extend the initial six-month payment deferrals.
“Eventually, the economy and borrowers will need to abide by market forces,” Lawless said. “This is when we could see a rise in mortgage arrears and the potential for a lift in urgent or forced sales.”
While Australia’s relative success in containing the virus means the economy is reopening quicker than in many other countries, the after-effects might linger for years.
A second wave of infections that slows or reverses the reopening could also set back the recovery.
A proposed 100 percent tariff on chip imports announced by US President Donald Trump could shift more of Taiwan’s semiconductor production overseas, a Taiwan Institute of Economic Research (TIER) researcher said yesterday. Trump’s tariff policy will accelerate the global semiconductor industry’s pace to establish roots in the US, leading to higher supply chain costs and ultimately raising prices of consumer electronics and creating uncertainty for future market demand, Arisa Liu (劉佩真) at the institute’s Taiwan Industry Economics Database said in a telephone interview. Trump’s move signals his intention to "restore the glory of the US semiconductor industry," Liu noted, saying that
On Ireland’s blustery western seaboard, researchers are gleefully flying giant kites — not for fun, but in the hope of generating renewable electricity and sparking a “revolution” in wind energy. “We use a kite to capture the wind and a generator at the bottom of it that captures the power,” said Padraic Doherty of Kitepower, the Dutch firm behind the venture. At its test site in operation since September 2023 near the small town of Bangor Erris, the team transports the vast 60-square-meter kite from a hangar across the lunar-like bogland to a generator. The kite is then attached by a
Foxconn Technology Co (鴻準精密), a metal casing supplier owned by Hon Hai Precision Industry Co (鴻海精密), yesterday announced plans to invest US$1 billion in the US over the next decade as part of its business transformation strategy. The Apple Inc supplier said in a statement that its board approved the investment on Thursday, as part of a transformation strategy focused on precision mold development, smart manufacturing, robotics and advanced automation. The strategy would have a strong emphasis on artificial intelligence (AI), the company added. The company said it aims to build a flexible, intelligent production ecosystem to boost competitiveness and sustainability. Foxconn
Leading Taiwanese bicycle brands Giant Manufacturing Co (巨大機械) and Merida Industry Co (美利達工業) on Sunday said that they have adopted measures to mitigate the impact of the tariff policies of US President Donald Trump’s administration. The US announced at the beginning of this month that it would impose a 20 percent tariff on imported goods made in Taiwan, effective on Thursday last week. The tariff would be added to other pre-existing most-favored-nation duties and industry-specific trade remedy levy, which would bring the overall tariff on Taiwan-made bicycles to between 25.5 percent and 31 percent. However, Giant did not seem too perturbed by the
RSS