Current Australian house price trends

Of course, there is not one property market around Australia as the following chart clearly shows.

The ongoing rise in housing values reflects a persistent imbalance between supply and demand which varies in magnitude across our cities and regions.

Perth continues to stand out with a substantially higher rate of growth compared to any other region, up 1.4% over the month.

Adelaide (+1.1%), Brisbane (+0.7%) and the regional areas of SA (+1.3%), WA  (+1.4%) and Queensland (+0.8%) also show a consistently high rate of capital growth month-to-month.

These regions are generally benefiting from a combination of comparatively lower housing prices and positive demographic factors that continue to support housing demand.

Although the pace of gains has slowed a little, most regions are still recording value growth well below the highs of last year.

Note: Onset of COVID calculated from March 2020

What you need to know about median house prices

We’ve written a detailed article explaining why not to trust median property prices here.

However, understanding median house prices can be useful because they give investors a rough guide about the locations they can afford.

Yet they should never be considered to be the Holy Grail of property data, because of the tendency for median prices to jump around from quarter to quarter.

They are more a reflection of the properties recently sold in the area rather than what a particular property is worth.

In many locations understanding the median house price is almost worthless because of the variations of the great variation in sale prices for houses, which means the area does not have a homogeneous style of housing.

For example, you could get a significant variation in property value for similar properties when you compare the more desirable locations within a particular suburb, such as a property having water views with ones that are less desirable such as on a busy road or even on a secondary main road or too near the train or with views of the service station across the street.

As you can see, if a suburb has housing of variable quality, the median house price is not very useful because some properties are simply more valuable than others.

However, if a suburb has very similar housing, such as renovated older homes on large blocks or a newer suburb where most of its housing stock was built over a few years, the median house price would be more relevant.

Melbourne’s median property price

Here is the latest data on the median property prices for Melbourne.

Source: CoreLogic, 1st November  2024

Melbourne’s values have risen 9.9% since the onset of Covid, but are still -5.1% below their peak of March 2022 and they fell-0.2% in October.

Melbourne buyers have consistently enjoyed more choice relative to other markets, at the same time construction rates relative to population growth in Victoria have been somewhat balanced compared to other parts of the country.

The result is that the Melbourne housing market has not performed as strongly as some other capitals over the last year or two.

However, this creates a window of opportunity for strategic property investors as Melbourne property values have significant upside potential.

The average price of a Melbourne standalone house is the lowest it has been against its Sydney equivalent in around twenty years.

Why the underperformance of the Melbourne market?

Partly it might reflect the greater stock of housing available for sale in the Melbourne market relative to other states.

Also, investor demand has also been lower in Melbourne dues to discontent with the way the Victorian government is treating investors and favouring tenants.

Also, one of the biggest short term influences on the property market performance is each city’s economy, and there is no doubt that there is plenty of negative sentiments about how the Victorian government is handling its economy.

However the Melbourne housing markets are fragmented and not surprisingly, there is currently a flight to quality properties in Melbourne, with A-grade homes and “investment grade” properties still in short supply for the prevailing demand, but B Grade properties are taking longer to sell and informed buyers are avoiding C Grade properties.

Moving forward strong immigration and a lack of supply of properties will help keep pushing Melbourne property prices higher.

Melbourne’s auction results show the market depth experienced so far this year with multiple buyers vying for good properties.

Sydney’s median property price

Here is the latest data on the median property prices for Sydney.

Source: CoreLogic, 1st November 2024

The pace of Sydney property price growth has slowed significantly over the last few months, but despite this deceleration, Sydney house prices have now risen 29% since the onset of Covid, however Sydney dwelling prices fell -0.1% in October.

The Sydney unit market has reached new highs roughly matching house price growth over the year.

Moving forward, the various sectors of the Sydney property markets will be fragmented, which is a more “normal” property market.

Sydney auction clearance rate have been strong all year, showing significant depth in the market and suggesting sale prices will continue to keep rising this year.

Brisbane’s median property price

Here is the latest data on the median property prices for Brisbane.

Source: CoreLogic, 1st November 2024

Brisbane’s housing market skyrocketed during the pandemic with 66.9% trough to peak growth, and is currently at a new peak in price.

Brisbane remains one of the strongest performing markets over the past year and our on-the-ground experience at Metropole Brisbane is that there is still strong demand from both home buyers and property investors for A-grade homes and investment-grade properties.

Supply is struggling to keep up with the rising demand, further supporting rising home values.

Brisbane has never been a city that held many auctions, however, as you can see from the chart below, the Brisbane auction market has been steady throughout 2024, suggesting property prices will keep rising.

Adelaide’s median property price

Here is the latest data on the median property prices for Adelaide.

Source: CoreLogic, 1st November 2024

The Adelaide property market remains one of the countries top performing markets rising for the seventh consecutive quarter.

The pace of growth remains high and well above the historical average as low stock levels intensify competition.

The comparative affordability of the city’s homes has seen prices defy the significant increase in interest rates since May 2022, but this affordability gap is now disappearing.

CoreLogic data shows Adelaide values recorded a COVID-19 “trough to peak” growth of 70.8 per cent.

Like in most capital cities, low stock levels are also helping to insulate home values, with increased competition among potential buyers

The strong auction clearance rates are an indication of the depth of the Adelaide property market and while they started a little lower this year, the depth of buyer demand has kept Adelaide auction clearance rates high.

Perth’s median property price

Here is the latest data on the median property prices for Perth.

Source: CoreLogic, 1st November 2024

Perth’s housing market continues to stand out nationally remaining the strongest market in the country for monthly and annual home price growth.

But remember…Perth housing values remained flat for most of the last decade, but over the last 15 months house and unit values in Perth enjoyed their most significant increases and are currently at a new peak.

The relative affordability of the city’s homes, population growth, and very tight rental markets are also supporting home values.

However, I would avoid investing in Perth for a number of reasons:

1. Currently East Coast property buyers are pushing up Perth property values, buying properties  site unseen and paying prices well above market price. This means the investor has to overpay, they will regret down the track.
   Our contacts on the ground in Perth advise us that East Coast buyers’ agents (NOT Metropole) are paying what they call “silly prices” significantly above what locals would pay, because properties are still relatively cheap in Perth. And they are buying these properties, site, unseen, creating significant risks for their clients.
2. The Western Australian economy is not as diverse as the other capital cities. While Perth is not a mining town, it is too dependent on a couple of industries – especially the mining industry which accounts for around 45% of the economic output and much of this is dependent on China, and this has a direct knock-on effect on WA house prices. The mining and energy companies are large employers in Perth. This means that the Perth property market is susceptible to a downturn in mining.
   Apart from the large energy companies, most corporate head offices are located in the eastern capital cities. Management roles in head offices tend to attract higher salaries which, to some extent, support/underpin property prices.
3. Further, the larger east coast capital cities have significantly larger the population with more diverse the employment opportunities which in general attract higher salaries.

Hobart’s median property price

Here is the latest data on the median property prices for Hobart.

Source: CoreLogic, 1st November 2024

Hobart was the darling of speculative property investors and the best-performing property market in 2017- 2018.

After rising 27.7% over the Covid period, Hobart dwelling values fell and are still -11.9% below their peak of March 2022.

Hobart remains the weakest capital city market when comparing annual price growth , as well as the change from peak, but prices rebounded slightly last month.

Darwin’s median property price

Here is the latest data on the median property prices for Darwin.

Source: CoreLogic, 1st November 2024

Darwin remains the most affordable capital city to purchase a house.

The city’s famously relaxed and laid-back lifestyle and the low-density population were a bonus in the post-pandemic era and drove interest in Darwin property.

After rising 23.4% over the Covid period, Darwin’s dwelling fell 7.5% after peaking in May 2014 and prices are still -6% below their previous peak.

Canberra’s median property price

Here is the latest data on the median property prices for Canberra.

Source: CoreLogic, 1st November 2024

Home prices in Canberra fell again in October, and are only up 0.7% from their October 2023 levels.

Overall Canberra’s median house prices recorded 30.8% growth since the beginning of Covid but are still 6.5% below their peak in May 2022.

The subdued Canberra auction clearance rates throughout the last year are a sign of the weakness of the Canberra property market.