The federal government’s plan to freeze population levels in Australia’s capital cities will lead to a fall in property prices, new research has found.
According to the People Power report, under the federal government’s “sustainable population strategy”, residential property prices could fall by as much as 20 per cent.
Over a 10 year period, Sydney’s residential property prices could fall by 18.3 per cent, while Melbourne and Brisbane could see prices drop by approximately 15 per cent.
The smallest decline is expected to occur in Adelaide with a 6.6 per cent fall in property prices.
But while falling property prices may sound great, Urban Taskforce’s chief executive Aaron Gadiel said capping population in the capital cities would have dire consequences for local communities and the national economy.
“With our aging population, if a city’s population is to remain static its workforce would need to decline to offset the rising number of people reaching retirement age,” Mr Gadiel said.
“The loss of workers would hit household income, which would feed in to lower property prices.”