Media Release | Cotality Home Value Index: prices fall again

What September's Cotality Home Value Index shows

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The following statement can be attributed to Oliver Hume Property Group Chief Economist, Matt Bell.

September dwelling prices fell for the sixth consecutive month, with all major capitals now negative on a monthly and quarterly basis. There was some change in the composition, with Melbourne’s rate of decline easing and now Brisbane leading the way down, followed closely by Sydney, Adelaide and Perth, all falling faster than 1% monthly.

On an annual basis, the falls to date are dwarfed by the rises that have occurred over the past 24 months for Brisbane, Perth and Adelaide, which are all still solidly in positive territory when it comes to annual price rises.

One notable difference in those capital city markets is the performance of lower - versus higher -priced properties. In Sydney and Melbourne, the rate of decline of the bottom quartile is less than half what the top quartile is experiencing. I.e., lower-priced suburbs are performing significantly better than the rest of the market. In Brisbane, Perth and Adelaide, the lower-priced suburbs are generally hurting just as much as the upper end.

Tuesday’s rate increaseand the likelihood of one more are likely to see dwelling price weaknesspersist through the rest of the year, and probably into the first quarter of2027. As expected, the impact of rate hikes and the rate outlook is dwarfingany budget investor taxation impacts.

On the positive side, auction clearance rates remain subdued, but the trend is clearly up off the lows. Yesterday’s inflation number came in a bit lower than markets expected, and the likelihood of a follow-up hike in November dropped below 40%. Unemployment is rising slowly, and any easing in economic conditions will support the fight against entrenched inflation.

Once the rates outlook stabilises, factors like historically low unemployment, strong population growth and supply-side bottlenecks will put a bottom on dwelling prices quickly. In markets like Brisbane, Perth and Adelaide, which were struggling with low supply and high demand prior to the rate-hiking cycle, the bounce-backs could be swift. For the larger markets of Sydney and Melbourne, their saving grace may be that they started the slide first and may have taken a larger proportion of the total pain compared to the rest of the capitals.

ENDS

Media enquiries to:

Lilly Mackay
Oliver Hume
l.mackay@oliverhume.com.au 
0437 899 949

or

Ben Ready
RGC Media & Mktng
ben@rgcmm.com.au
0415 743 838 

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