Almost one out of 100 homebuyers in negative equity, RBA says
The Reserve Bank of Australia warns that the economy is vulnerable to global financial shocks, particularly those stemming from the AI investment boom. Additionally, rising interest rates and falling property prices are pushing a growing number of recent homebuyers into negative equity.
Why it matters
This highlights systemic risks in the Australian housing market and potential global economic instability linked to speculative AI investments.
— 6:06pm , first published 11:58am
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Share A A A The Australian economy is increasingly vulnerable to a major global financial shock triggered by a loss of confidence in the AI investment boom, the Reserve Bank has warned.
The bank’s twice-yearly review of financial stability also says recent first home buyers – including users of the government’s 5 per cent deposit scheme – are most likely to be in negative equity as property prices sink and interest rates increase.
A further 20 per cent slump in house prices would push about one in 20 borrowers into negative equity, where a home borrower’s loan is higher than the value of their property.
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