December Brings a Shift: National Home Values See Rare Decline
As the year came to a close, the median price of an Australian home fell by 0.17% in December, marking the first monthly decline since December 2022. This drop represents a significant turning point in the housing market, which had enjoyed a prolonged period of consistent growth.
The decline reflects changing dynamics within the property sector, with factors such as increased housing supply, reduced buyer competition, and seasonal influences contributing to softer pricing. After nearly two years of sustained value increases, this shift indicates a cooling market and a potential rebalancing of property values as the sector adjusts to evolving economic conditions.Â
Despite a significant decline in December, national home prices remain 4.73% higher than they were during the same period last year, highlighting the remarkable resilience of the housing market. This year-on-year growth underscores the market’s ability to maintain value, even amidst challenging conditions and fluctuations in economic factors.
Data from the Greater Capital City Statistical Areas (GCCSA) indicates that Adelaide saw remarkable annual growth of 13%, with median property values ranging between $595,000 and $849,000. Perth and Hobart managed to register price increases during December, highlighting their resilience in a market that has otherwise begun to cool. Perth, in particular, achieved a record-breaking peak in property values, solidifying its reputation as a strong and stable performer despite broader economic challenges and fluctuating market conditions.
Regional property values have remained largely stable, recording a slight increase of 0.03%, in contrast to the combined capital city areas, which saw a 0.25% decline in home prices over the month. Although the surge in regional living observed during the pandemic has largely subsided, net intrastate migration from capital cities to regional areas continues, sustaining demand for housing in these markets. Meanwhile, new home construction in many regional areas has struggled to keep pace with this demand, resulting in heightened competition and rising prices for the limited number of properties available.
With double-digit price growth in markets like Perth, Adelaide, and Brisbane contrasting sharply with declines in Melbourne and Darwin, 2024 has been described by some as a year of the most varied housing market conditions in Australia in recent memory.
The divergence in property trends underscores the significant influence of regional factors, such as differing levels of population growth, housing supply constraints, and local economic conditions. These variations illustrate the complex and multifaceted nature of Australia’s property market, where national trends are often shaped by distinct localised forces.
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Source:
https://www.realestate.com.au/insights/proptrack-home-price-index-december-2024/
