- PropTrack found national home prices down 0.09% in Jan.
- This takes the total decline from the peak to 4.51%.
- Prices fell in every capital city except Perth and Darwin.
Property prices across the country have continued to fall in January, however, the rate of decline is starting to slow down according to new data.
The PropTrack Home Price Index for January found that national home prices recorded a modest 0.09 per cent fall last month, taking the total decline from the peak to 4.51 per cent.
Prices fell in every capital city except Perth (0.06 per cent) and Darwin (0 per cent) where they continue to hold at near record-high levels, while Canberra (-0.24 per cent) and Melbourne (-0.22 per cent) recorded the sharpest falls.
Despite recent falls, prices nationally are still 28.5 per cent above their pre-pandemic levels, with Hobart 43.9 per cent higher than in March 2020, Adelaide 43 per cent and Brisbane 42.1 per cent.
PropTrack Senior Economist, Eleanor Creagh said the sharpest increase in interest in decades has been a key driver of the price declines, however, there could be relief in sight for homeowners.
“National home prices have fallen for the tenth month in a row, with the substantial 300 bp of cash rate tightening seen last year weighing on home prices in most parts of the country. However, the worst of the downturn appears to have passed,” Ms Creagh said.
“The rapid pace of price falls seen in June and July 2022 when interest rates first started rising has subsided and price falls have eased in most capital cities in recent months.
Since their peaking at around the same time the Reserve Bank of Australia (RBA) started tightening monetary policy, home prices have fallen at the fastest pace in more than a decade in Sydney, Brisbane and Hobart.
While home prices in Canberra have recorded both the fastest and deepest decline in over ten years.
Regionally, home prices in WA fell the fastest in January, slipping 0.27 per cent, while regional South Australia continues to defy the downturn, with prices rising 0.46 per cent to a new peak.
Overall, regional prices have held up better than capital cities, falling 0.03 per cent in January to sit 0.32 per cent above their level a year ago, while in the capital cities, prices fell 0.11 per cent but are now 4.68 per cent below their level a year ago.
Ms Creagh said property prices will likely continue to soften while the RBA keeps its hawkish stance on interest rates.
“A further 25bp rate rise in February, taking the cash rate to 3.35 per cent, is widely expected,” she said.
“The continued reduction in borrowing capacities will weigh on prices in the period ahead, though the declines will likely continue at this slower pace as interest rates approach their peak.
“Home prices may begin to stabilise as interest rate uncertainty reduces later in the year.”
Sydney
Sydney home prices recorded a slight 0.06 per cent fall in January and are now down 7.27 per cent over the past year according to Ms Creagh.
“Prices have fallen persistently since March 2022, with Sydney seeing the largest falls of any market and its fastest (but not deepest) price falls in over a decade,” she said.
“As interest rates have risen, home prices have fallen quicker across more expensive regions and property types.
“However, the magnitude of price declines in Sydney has eased in recent months from the faster pace seen in June and July last year.”
Melbourne
Ms Creagh said Melbourne home price falls eased in January, though they still fell at one of the fastest paces (-0.22 per cent) out of the capital cities in the month.
“Prices are now 5.79 per cent below their January 2022 level and 6.42 per cent below their March 2022 peak,” she said.
“Price falls are expected to continue in Melbourne in the period ahead as interest rates continue to rise, further reducing borrowing capacities.”
Brisbane
After experiencing some of the largest price prices over the past few years, prices recorded a slight fall (-0.07 per cent) in Brisbane in January and are now down 0.24 per cent over the past year.
“Conditions in Brisbane have quickly shifted due to the substantial tightening in interest rates seen last year,” Ms Creagh said.
“Prices are now 3.76 per cent below their peak recorded in April 2022, with Brisbane recording its fastest (but not deepest) decline in home prices in more than a decade.
“However, the magnitude of price declines in Brisbane has eased in recent months from the faster pace seen last year.”
Adelaide
Adelaide, the strongest performing capital city market over the past year, saw home prices fall 0.14 per cent in January Ms Creagh said.
Prices are now down 0.21 per cent from their October peak, however, they remain 7.94 per cent above their January 2022 level.
“The comparative affordability of the city’s homes has seen prices holding up better as interest rates have quickly risen,” Ms Creagh said.
Perth
Ms Creagh said Perth home prices recorded a slight increase (+0.06 per cent) in January, with the city continuing to hold up better than other capitals.
“Prices have increased 3.1 per cent over the past year and are just 0.50 per cent below peak levels recorded in October last year,” she said.
Hobart
Home prices in Hobart fell a slight 0.05 per cent in January to sit 2.88 per cent below their peak in April 2022 according to Ms Creagh
“Hobart has recorded its fastest (but not deepest) decline in more than a decade,” she said.
“However, the magnitude of price declines in Hobart has eased in recent months from the faster pace seen last year.
“Prices are 1.46 per cent below levels seen in January last year and are up 43.9 per cent compared to pre-pandemic levels in March 2020.”
Darwin
Darwin home prices were flat in January, holding out at peak levels according to Ms Creagh.
Home prices have increased 1.5 per cent over the past year and remain 28 per cent above pre-pandemic levels.
ACT
Prices in Canberra fell 0.24 per cent in January and are now sitting 5.59 per cent below their peak in March 2022, with home prices recording both the fastest and deepest decline in more than a decade in Canberra.
Ms Creagh said the magnitude of price declines in Canberra has eased in recent months from the faster pace seen mid-last year.
