The latest numbers from property data gurus Core Logic revealed national housing values had fallen at their fastest rate on record, dropping by 8.4 percent since prices peaked in May last year. The cities most impacted are those that typically experienced the strongest gains in the ‘COVID’ years prior to the peak.
Unsurprisingly, Sydney’s housing values have pulled back 12.1 percent over the past twelve months, Melbourne is off 8.1 percent and Hobart has declined 6.9 percent. It’s worth remembering national property values have risen 28.9 percent since government stimulus and emergency interest rate settings were introduced to counter COVID-related economic shocks.
Adelaide is suddenly leading the capital city pack showing a 10.1 percent rise in house values in 2022. Darwin’s prices held positive at 4.3 percent growth and Perth moved forward 3.6 percent for the year.
Perth’s property prices peaked in July 2022 and have only retreated 0.6 percent since then, the smallest fall across the nation. Perth property values have gained 25.9 percent since late 2019 with our regions still climbing after already having put on 31.5 percent.
Looking more closely at the numbers, Perth is looking the most likely capital city to weather the current higher interest rate and inflationary environment best as 2023 unfolds. Last month, Perth was the only capital to post a positive price gain albeit a moderate 0.1 percent, but it does indicate that all other capitals are past their peak.
With a median house value at $560,902, Perth remains the most affordable city compared to east coast capitals. Adelaide’s median price is $88,139 higher than Perth’s and it is still $112,431 more expensive to buy in Hobart than locally.
As interest rates continue to climb, property values across eastern Australia are likely to continue their decline. However, the chances that they’ll give up their recent gains is highly unlikely. Population growth is tipped to expand as 2023 unfolds and most economists predict interest rates will stabilise in the back half of this year as inflation moderates. These factors, along with low unemployment rates and healthy consumer bank balances, will help most households cope with rising interest rate costs this year.
As Australia’s most affordable state capital, Perth’s fundamentals are poised to deliver property value gains this year due to our more moderate response to the ‘COVID boom’, strong employment opportunities and population gains.
Licensed real estate agents are regulated by the Department of Mines, Industry Regulation and Safety (DMIRS) with consumers able to seek advice and lodge complaints about agents’ behaviour to that department. The Real Estate Institute of WA (REIWA) also has a community hotline where consumers can obtain real estate advice … Read more
There are early signs that the property market is tipping back into equilibrium as listing levels creep up (currently at 3-year highs), numbers through home opens edge back and inflationary pressures bite. Although, it remains a sellers’ market with the balance between supply and demand still a long way from … Read more