Australians still face a huge dilemma between property prices plunging across the cities and the fear of interest rates going higher. Based on CoreLogic’s recent report, the national home value has fallen by –1.4% in September, with housing values across the combined capitals down by approximately -$46,100 since the recent peak.
Meanwhile, there were 1,613 homes for auction across the combined capital cities, up from 1,316 (+22.6%) in the previous week. Continue reading to find out which cities lead the property decline and auction volumes.
Property values continue the downtrend
With the successive rate hikes and increase in the cost of living, financial pressures continue to push the demands for homes down. CoreLogic’s latest Home Value Index reveals that national home values recorded a -1.4% fall in September from -1.6% in August.
While Sydney recorded a milder drop of –1.8% compared to -2.3% in August, the city still leads the decline as housing values are now 9% below its January 2022 peak – this is a price drop of $104,300 from the median value.
Meanwhile, Melbourne also eased in the rate of decline as it fell by -1.1% compared to -1.2% in August, and Brisbane went from -1.8% to -1.7% in September. Defying the trend was Darwin as it remains the only capital city where housing values haven’t gone down.
Although the housing downturn eased this month, experts hinted that it’s not yet the end of a gloomy market. The projected interest rate rises will likely drive home prices further down.
As stated by Tim Lawless, CoreLogic’s research director, “It’s possible we have seen the initial shock of a rapid rise in interest rates pass through the market and most borrowers and prospective home buyers have now ‘priced in’ further rate hikes.”
“However, if interest rates continue to rise as rapidly as they have since May, we could see the rate of decline in housing values accelerate once again.”
Is 2022 the year to buy a property? Check out what It’s Simple’s managing director, Joseph Daoud, shares about the Australian property market:
Preliminary total auctions in capital cities
Aside from property prices plummeting, choices are still up for home buyers as auction volumes remain firm: “Across the combined capitals, total advertised stock levels are tracking 7% higher than the same time last year, but are still -15% below the previous five-year average.”
“In some of the weaker cities, total advertised stock levels have risen to above average levels, including Sydney (1.1% above the previous five-year average), Melbourne (+9.7%) and Hobart (+9.0%).”
Based on CoreLogic’s recent Property Pulse, Melbourne led this week’s auctions with 823 homes, a sharp increase of 533.1% from 130 last week. Following Melbourne is Sydney with 489 auctions, down by -39.4% from the previous week. However, the downturn in auction activity can be attributed to Labour Day and the NRL Grand Final.
Of the smaller capital cities, Brisbane still led auction activities with 116 homes up for auction, followed by Adelaide with 102 and Canberra with 61. Meanwhile, Perth recorded 19 auctions while Tasmania only had 3.
Preliminary total clearance rate
Preliminary clearance rates across the combined capitals remain above the 60% mark with 62.3% of the results collected so far turned successful. This is up by 1.7% from the previous week’s preliminary rate of 60.6% (revised to 60% at final figures).
While Melbourne led the auction volumes, the city’s preliminary clearance rate dropped by -1.8% to 64.3%. Last week, Melbourne recorded 66%, which was later revised to 64.6%.
Following Melbourne is Sydney with a 60.4% preliminary clearance rate. This is down by –0.20% from last week’s preliminary rate of 60.6% (revised to 61.3% at final figures). Last week, Sydney recorded its highest final clearance rate since the week ending 10th April 2022.
Among the smaller capital cities, Adelaide still led the preliminary clearance rate with a record of 78.3%, followed by Canberra with 62.5%, Brisbane with 45.9% and Perth with 40%. On the other hand, 1 out of the 3 auctions in Tasmania was successful.
With the auction volumes still above the 60% mark for five consecutive weeks and property prices still favouring buyers, now is your chance to purchase a home you’ve been eyeing at a lower price point.
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