Australian property prices surged over 8 per cent, but is your city a price growth star or the laggard
Australian property prices rebounded from 2022 falls, delivering a nasty shock to hip pockets around Australia, but the surging prices weren’t for every capital city. Image: Canva.
  • Overall, Australian real estate prices rebounded from declines in 2022.
  • There was more variation in the price movement outcomes of each city and region.
  • Experts share insights into buyer mindsets and behaviours.

The value of Australia’s real estate market leapt 8.1% in 2023, eclipsing the 4.9% fall recorded in 2022, but well behind the meteoric 24.5% rise recorded in 2021, according to the latest CoreLogic National Home Value Index (HVI).

Behind the scenes is a slowing pace of monthly price rises, with December only recording a 0.4% uptick in Australian home prices.

“This was the smallest gain in our national monthly HVI since values started rising in February,” said CoreLogic research director, Tim Lawless.

“After monthly growth in home values peaked in May at 1.3%, a rate hike in June and another in November, along with persistent cost of living pressures, worsening affordability challenges, rising advertised stock levels and low consumer sentiment, have progressively taken some heat out of the market through the second half of the year.”

While Australian property prices have recorded a massive rise in recent years, property buyers are accepting the cost where they can, cognisant of the challenging circumstances.

“Buyers are willing to keep paying high prices because the shortage of listings and rentals leaves no other option. On the other hand, high interest rates and economic fears put a cap on what buyers can realistically afford,” Juwai IQI co-founder and group managing director, Daniel Ho, told The Property Tribune.

Daniel Ho
Daniel Ho. Image: Supplied.

“We still see strong demand in areas with high proportions of owner-occupiers.

“The weakest suburbs are those with high rates of investors, given that many investors buying today will end up with the lowest yields we have seen in years.”

Daniel Ho, Juwai IQI

“We expect the first quarter to be more of the same. Buyers and vendors alike will come back to the market seeking the best possible results.”

A tale of two speeds

Australia’s various capitals and regions recorded vastly different results. While Perth housing values took flight at 15.2%, regional Victoria fell 1.6%.

Broadly in two categories, the smaller capitals of Perth, Adelaide, and Brisbane recorded strong growth across last year, while Sydney and Melbourne began to see prices stabilise or fall.

According to CoreLogic data, Sydney and Melbourne reached their market peaks in January and March of 2022, respectively, while Perth, Adelaide, and Brisbane are all still at their peak.

Change in dwelling values

Month Quarter Annual Total return Median value
Sydney 0.2% 0.8% 11.1% 14.3%  $1,128,322
Melbourne -0.3% -0.2% 3.5% 7.0%  $780,457
Brisbane 1.0% 3.7% 13.1% 17.9%  $787,217
Adelaide 1.3% 3.7% 8.8% 13.2%  $711,604
Perth 1.5% 5.1% 15.2% 20.7%  $660,754
Hobart -0.3% 0.4% -0.8% 3.2%  $656,947
Darwin 0.7% 0.4% -0.1% 5.9%  $496,309
Canberra -0.1% 0.6% 0.5% 4.5%  $843,171
Combined capitals 0.4% 1.5% 9.3% 13.1%  $832,193
Combined regional 0.3% 1.5% 4.4% 8.9%  $605,780
National 0.4% 1.5% 8.1% 12.1%  $757,746

Index results as at 31 December 2023. Source: CoreLogic.

“Such diversity across the capital cities can be broadly attributed to factors relating to demand and supply,” said Lawless.

“In Perth, Adelaide and Brisbane, housing affordability challenges haven’t been as pressing relative to the larger cities, and advertised supply levels have remained persistently and substantially below average.

“The cities where home value growth has been lower or negative through the year are showing higher than average levels of advertised supply alongside annual home sales which ended the year below the five year average.”

Tim Lawless, CoreLogic

Capitals continue outperforming the regions

Collectively, Australia’s capital cities more than doubled the value growth seen across the regions, up 9.3% compared to 4.4%.

“Stronger conditions across capital city markets is a reversal of the early COVID trend which saw regional markets experience higher demand amid strong internal migration,” said Lawless.

“Regional migration trends have mostly normalised through 2023, and the significant capital gains recorded through 2020 to 2022 has meant many regional markets have become less affordable.”

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