Australia’s Housing Market: A Tale of Diverging Trends
Australia’s housing market is experiencing a unique dichotomy, with property prices surging in certain cities while stagnating or declining in others. According to Jemimah Clegg’s article A Tale of Two Markets: Why Home Prices in Half of Australia’s Capitals Keep Surging While Others Slump, this trend highlights the complex dynamics shaping the nation’s real estate landscape.
The national dwelling prices saw a modest rise of 0.04% in September, bringing the median price to $792,000. However, the performance was not uniform across the country. Cities like Adelaide, Perth, and Brisbane witnessed notable growth, with year-on-year increases of 15%, 22%, and 13%, respectively. In contrast, Melbourne and Hobart saw declines in their property markets, with Melbourne suffering the largest yearly drop of 1.79%.
Adelaide was a standout performer, achieving the highest monthly growth at 0.53%, and its affordability remains a key factor in attracting buyers. Eleanor Creagh, senior economist at PropTrack, explained that “the comparative affordability of the city’s homes has contributed to the ongoing strong growth.” This affordability advantage may allow Adelaide to surpass Melbourne’s property values as early as next year.
Meanwhile, Perth maintained its upward trend with an annual price growth of 22%. Despite the influx of spring listings, Perth’s property market remains one of the strongest in the country. As Creagh noted, “buyers enjoyed more choice as the typically busier spring selling season began.” However, the demand continues to outstrip supply, particularly in cities like Brisbane, where listings remain relatively constrained.
In Sydney, property prices grew by 4.88% over the past year, despite the slower monthly increase of just 0.01%. This slower growth is attributed to affordability constraints, higher interest rates, and an increase in properties hitting the market. “Prices remained at peak levels, up 3.96% year-to-date,” Creagh remarked, indicating a sustained demand for housing in the country’s most populous city.
On the other hand, Melbourne’s outer east is seeing a buyer’s market. Ray White Ferntree Gully agent Tim Milaki pointed out that “if it’s not priced right, buyers won’t come.” The surge in available properties has led to a sixth consecutive month of declining prices in Melbourne, giving buyers more negotiating power.
In conclusion, Australia’s housing market remains a mixed bag, with cities like Adelaide, Perth, and Brisbane leading the charge, while Melbourne and Hobart struggle. As spring unfolds, experts anticipate further gains, but with interest-rate uncertainty looming, the pace of growth is expected to slow. For now, the Australian property market is very much a tale of two worlds, shaped by varying supply levels and buyer demand across the country.
References:
Melissa Fisher
Founder, Acuity Development Group & The Right Team