Australian home prices hit a record high during the peak spring selling season but home values in Sydney dipped in the city’s first month-on-month decline since January 2023.
The PropTrack report found prices in the combined capital cities increased 5.85% over the past year, after climbing a further 0.28% in October.
After six months of falls, Melbourne’s home prices recorded a 0.49% jump – the highest monthly growth rate of the capitals.
Perth, Adelaide and Brisbane remain the strongest capital markets for annual growth, with prices up 20.58%, 14.91% and 12.51% over the past year, respectively.
New research from CoreLogic showed Sydney had its first month-on-month decline since January 2023, with the downturn driven by weaker conditions in the most expensive areas of the market.
The 0.1% fall in Sydney was the first monthly decline since January 2023, after a 12.4% drop between February 2022 and January 2023.
Weaker conditions have been led by falls in the most expensive areas of the market, CoreLogic said. There was a 0.6% drop in upper-quartile house values over October and a 1.1% drop over the past three months, the report said.
In comparison, Sydney’s lower-quartile house and unit values both recorded a 0.5% rise in October.
CoreLogic’s Tim Lawless said the stronger performance across the more affordable end of the market was a consistent theme across all capital cities.
“A combination of less borrowing capacity and broader affordability challenges, as well as a higher-than-average share of investors and first home buyers in the market is the most likely explanation for stronger conditions across the lower value cohorts of the market,” he said.
Based on a rolling four-week count of property listings to 27 October, advertised inventory had increased 12.7% since the end of winter across the combined capitals, the report said. The largest increase occurred in Perth where listings were 20.6% higher, albeit from an exceptionally low base.
“Total listings are now 13.2% above the previous five-year average in Sydney and 13.0% higher in Melbourne,” Lawless said. He said these figures helped explain the weaker conditions in these markets as buyers were benefiting from more choice and less urgency in their decision-making.
