The value of Sydney and Melbourne houses are dropping by $1,000 a week, according to the latest quarterly Business Outlook from Deloitte Access Economics. 

However, despite the house prices falling, Australia’s growth has continued to accelerate with an estimate of 3.3 per cent GDP growth this financial year, up from 2.9 per cent last year. 

“Yes, they’re falling but they’re not falling at a dangerous rate and it’s making them, shifting them, to safer territory,” Deloitte Access Economics economist Chris Richardson said. 

“There are more falls to come, particularly in Sydney and Melbourne, because the prices there got silliest and you’re seeing a range of pressures on it,” he added. 

The three main factors putting downward pressure on prices include the banks raising interest rates, banks becoming more cautious with the loans they are giving, and foreign buyers also becoming more cautious leading to less money from overseas. 

However, Deloitte estimates that there will be better wage growth and higher interest rates in the future. 

Mr Richardson said that even though there was a long period of low interest rates and low wage growth, both measures will start to grow, albeit at “snail’s pace”. 

“It’s not as though wage growth or interest rates will roar up, but both of them will slowly move up over time,” Mr Richardson said.