Australia’s National Housing Market Loses Steam, Sees Weakest Growth in 22 Months

Two roofers position a piece of insulation on a roof in Albany, Western Australia, on Aug. 23, 2024. Susan Mortimer/The Epoch Times

Australia’s current housing growth may have reached the end of the cycle, with national prices edging up 0.1 percent in November, according to property searcher CoreLogic.

This marked the 22nd straight month of growth and was the weakest Australia-wide result since January 2023.

The two most populous capital cities saw their property growth fall into the negatives, with Sydney house prices falling 0.2 percent and Melbourne dropping 0.4 percent.

However, Perth house prices spiked 1.1 percent, while they jumped 0.8 percent in Adelaide and 0.6 percent in Brisbane. Darwin home values lifted 0.2 percent, while they climbed 0.1 percent in Canberra.

CoreLogic research director Tim Lawless said, “The downturn is gathering momentum in Melbourne and Sydney.

“Meanwhile, the mid-sized capitals, which have dominated the growth cycle of late, are also losing steam.”

Growth Discrepancies

Perth home values have skyrocketed 21 percent in the last year, followed by Adelaide at 14 percent and Brisbane at 12.1 percent.

Sydney house prices have risen 3.3 percent annually, while they have fallen 2.3 percent in Melbourne and slid 1 percent in Hobart. In Darwin, house prices have climbed 0.9 percent, while they have dropped 0.1 percent in Canberra.

On a quarterly basis, Perth house values rose 3 percent, Adelaide 2.8 percent, Brisbane 1.8 percent, and Hobart 0.4 percent.

However, Sydney properties fell 0.5 percent in the quarter, Melbourne values slid 1 percent, Darwin fell 0.7 percent and Canberra slipped 0.3 percent.

Regional properties, on the whole, rose 1.1 percent in the quarter, while the combined capitals Australia-wide crept up 0.3 percent.

“The mid-sized capitals and most of the regional rest of state markets continue to provide some support for growth in the national index, but it is clear momentum is also leaving these markets,” Lawless said.

Looking at listings, CoreLogic noted that weaker housing conditions had been paired with a rebalancing in available supply, with vendor activity rising in spring.

In the four weeks ending Nov. 24, capital city listings have risen 16 percent since the end of winter, with Perth recording a 33 percent rise in listings, compared to 25 percent in Adelaide.

Sydney listings are up 10.4 percent higher than their five-year averages, while Melbourne listings are 9.1 percent higher.

On the flip side, purchasing activity also appears to be dropping, according to CoreLogic, with home sales in the last three months 4.6 percent lower than a year ago based on their estimates.

With more available supply and less buying activity, the selling conditions deteriorated during the Spring.

How Do Median Home Values Compare?

A median home in Sydney is now worth $1,196,809 (US$777,000), while a median Melbourne property is worth $776,949.

In Brisbane, the median value of a home is $886,540, while in Adelaide it is $813,716 and $808,090 in Perth.

A Canberra median property is $851,731, compared to $654,339 in Hobart and $496,860 in Darwin. In regional areas, the combined median house price is $649,899.

In Australia as a whole, the national median value of a home is $812,933.

What About Rentals?

The national rental index rose 0.2 percent in November and have risen 5.3 percent in the past 12 months.

This is less than a year ago, when it increased by 8.1 percent.

“At 5.3 percent annual growth, rents are still rising at more than twice the pre-pandemic decade average of 2.0 percent, but given the weak monthly change the annual trend is set to slow further from here,” Lawless said.

“It will be interesting to see if the rate of rental growth rebounds through the seasonally strong first quarter of the year in 2025, but beyond any seasonality, it looks increasingly like the rental boom is over.

As house prices have soared in Perth, so too have the rents. The city’s unit rental market rose 9.7 percent in a year up to Nov. 30. However, this has slowed from 16.6 percent in late 2023 and early 2024.

House rents in Perth have also jumped 8.7 percent.

Home Building Approvals Rise

Meanwhile, Australian Bureau of Statistics (ABS) data released on Dec. 2 shows home building approvals lifted 4.2 percent in Oct. 2024 to 15,498. This follows dwelling approvals rising 5.8 percent in September.

Master Builders Australia described the data as “good news” but explained much more needs to be done to build the 1.2 million homes Australians desperately need.