Australian House Prices Record Sharpest Quarterly Fall
Australian house prices recorded their steepest quarterly decline on record, falling 4.7 per cent in the September quarter, according to new data from Domain.
All capital cities experienced house price falls during the quarter. It was the first time in 15 years that prices had declined across every capital city simultaneously, and only the second occurrence on record.
Perth recorded the biggest drop, with house prices falling 7.4 per cent. Sydney prices declined 4.7 per cent, while Melbourne recorded a 3.3 per cent fall. Both cities experienced their largest quarterly declines in four years.
The combined median house price across Australia's capital cities fell to $1,226,566. Unit prices also dropped by 3.5 per cent, marking the second consecutive quarter of declines for both houses and units.
Domain chief residential economist Nicola Powell said the downturn had spread beyond a small number of markets. Properties were taking longer to sell, buyers had more room to negotiate, and sellers were facing greater pressure to adjust their price expectations.
Economists say higher interest rates, stretched affordability and rising living costs have weakened buyer demand. Three consecutive interest rate increases have also affected market confidence.
Property data from Cotality shows that more expensive homes have generally experienced sharper declines than lower-priced properties. In Sydney, prices in the highest-value quarter of the market fell by more than twice as much as those in the lowest-value quarter.
Lower-priced properties have remained relatively resilient nationwide, with prices in Darwin's lowest-value segment recording growth. Economists attribute this trend to the greater number of buyers who can afford cheaper homes, while high borrowing costs are limiting demand for more expensive properties.
Changes announced in the federal budget have also attracted attention, but experts say the downturn began before the May budget measures affecting investment taxes. Falling prices and successive interest rate increases were already weighing on the market.
Auction activity has weakened significantly. Cotality recorded 1,423 auctions across the capital cities last week, roughly half the level seen a year earlier.
First-home buyers are also becoming more cautious. With affordability under pressure and more properties available for sale, some potential buyers are delaying purchases in anticipation of further price falls.
Property economist Cameron Kusher expects the downturn to continue beyond initial expectations. A recovery may depend partly on clearer signs that interest rates are set to fall.
The latest figures point to a significant shift in Australia's housing market, with weaker demand, reduced borrowing capacity and growing buyer caution putting pressure on property values across the country.
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Source : ABC News
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