Mixed bag for home values as Australia shifts to multi-speed market

The tool used the CoreLogic Home Value Index to provide a national overview of each suburb’s current median value, as well as quarterly and annual value change.

Despite a 2.4 per cent increase in national dwelling values for Q1 of 2022, the Home Value Index figures show that it is lower than the 5.8 per cent increase in the same period of 2021.

Digging deeper into the CoreLogic data, results show that in the March 2022 quarter, 354 (38.6 per cent) of the 917 house and unit markets studied in Sydney had a fall in value where more than half of the losses were in the housing market.

Properties in Beaconsfield saw a value drop of 7.2 per cent, while houses in Gladesville saw a value drop of 0.01 per cent.

In the three months leading up to March, nearly half of the 648 Melbourne house and unit markets studied saw a 46.8 per cent decrease in value. Houses in the inner-city suburb of Cremorne had a -6.4 per cent drop, while those in Boronia saw a -0.01 per cent drop.

CoreLogic head of research Eliza Owen said the quarterly values indicated a gradual shift from a lengthy era of broad growth to a multi-speed market with variances between capital cities, regions, and property types.

Commenting on the shift in market conditions observed in high-end and inner-city areas, Ms Owen explained: “It is likely that slightly tighter lending conditions and higher average fixed rates are hitting the very top of housing markets first.

“These same areas are seeing some of the bigger jumps in advertised stock levels too, so as we see new demand for housing in these areas decline buyers have more choice, more time for decision-making, and more power at the negotiating table.”

Zooming in on Melbourne, Ms Owen said Victoria’s capital city has had two monthly market drops in the last four months, and that suburb changes indicate the city was entering the downswing phase of its cycle.

However, as Melbourne’s inner city and east property markets start to lose steam, those at the city fringes are thriving, such as Wyndham Vale which experienced the largest quarterly growth of 6.7 per cent in its house and unit markets.

The research head has attributed the growth in cheaper areas of the city to purchasers who may have been priced out of the CBD.

On the flipside, Brisbane and Adelaide property markets have emerged as strong performers with no quarterly or annual price declines in any of the 651 housing markets studied by CoreLogic. Only about one per cent of the markets studied in these cities had a quarterly loss due to minor falls in unit markets.

In addition, Ms Owen has noted that Logan Central topped the Greater Brisbane list, with a 13.5 per cent gain in value in the March quarter, followed by areas in the south of Brisbane River - Acacia Ridge, Capalaba, and Yeronga – with value increases of around 10 per cent.

“For those migrating from the southern states, a typical house in Brisbane was $857,000 in March, significantly less than Sydney’s median of $1.4 million,” she stated.

Looking at Adelaide’s markets, the most significant quarterly value increases were recorded in Largs North, Ottoway, and North Haven.

Adelaide was the country's third most inexpensive capital city behind Perth and Darwin, according to CoreLogic, with a median house value of $602,000 at the end of March.

House values have also dropped across the smaller capital cities, with Canberra seeing a 5.2 per cent quarterly fall in house value, followed by Hobart (10.9 per cent), Perth (13.4 per cent), and Darwin (18.0 per cent).

However, Ms Owen has flagged that despite what appears to be a large number of quarterly value drops, Perth saw decent value gains in the March quarter.

Wannanup units gained the most value in Perth, rising 9.3 per cent in the quarter, while Forrestdale was the top home market, rising 5.3 per cent.