There's no relief in sight for Australian property owners as experts warn house prices will continue to tumble well into next year.
According to Morgan Stanley's latest forecast, property prices could plummet by up to 15 per cent — meaning we're now facing the biggest drop in decades.
In fact, the organisation's forward-looking housing model has dropped to the lowest level ever recorded.
"We struggle to see improvement in any of our components over the next year, with pre-existing headwinds of net supply, an RBA on hold and sustained focus on lending standards, all independent of potential negative gearing/capital gains tax changes," Morgan Stanley said in the report.
"We now see a 10-15 per cent peak to trough decline in real house prices, from 5-10 per cent previously, which would mark the largest decline since the early 1980s.
"This downgrade largely reflects the downturn's extended length, as we expect the relatively orderly declines to date will continue."
Some of the drivers behind the trend are an oversupply of new apartments thanks largely to the "East Coast apartment boom" as well as a drop in net migration, which have combined to cause supply to outstrip demand.
But it's not just Morgan Stanley making a grim property prediction.
CoreLogic figures released earlier this month found values had dropped by 2.7 per cent across Australia in September, with Sydney home prices down 6.1 per cent and Melbourne down 3.4 per cent.
Last month, ANZ announced its predication that house prices would remain weak into 2020, while in June, ANZ and Macquarie both predicted a Sydney house price fall of 10 per cent.
And NAB's newly-released Quarterly Australian Residential Property Survey also found confidence in the market among real estate agents had "dipped to new lows", predicting the house price would continue over the next 18 to 24 months.
Starr Partners chief executive Doug Driscoll told news.com.au Morgan Stanley's prediction was not "inconceivable".
"As much as I don't want to see that happen, it's not inconceivable that it could happen," he said.
"But what people cannot lose sight of is the fact that — say hypothetically prices do come down by 15 per cent — for the five years prior to the point where it started to dip around 12 months ago, prices went up in Sydney by 60 per cent.
"For any kind of market to have that kind of exponential growth is phenomenal. When you look at markets and cycles, there's typically a correlation between growth and decline."
Driscoll said Sydney's house prices had previously exploded thanks to the "perfect storm" of having investors represent more than half the market coupled with low interest rates and supply.
"Markets do work in cycles and that's what we forget about. It's a case of perspective — if it goes up 60 per cent in a five-year period, it's inevitable it will fall away and plateau before going up in the next cycle which may be in two or three years' time," he said.
"That part of the cycle was more aggressive than probably any in living memory and when it's so aggressive in ascendancy it might be harsher in descendancy."
But Driscoll said while those who purchased property this year would probably not make money immediately, property was still a good investment in the medium to long term.
He said he couldn't see the market "bouncing back next year" due to uncertainty over the federal election and interest rates but he expected it to rise again in the coming years.