October’s Latest Insights on Australia’s Major City Property Markets

October’s Latest Insights on Australia’s Major City Property Markets

If you’re looking to buy or sell property in Australia, keeping up with the latest market trends can give you a serious advantage. With Australia’s property market constantly shifting due to economic conditions, supply and demand, and buyer preferences, there’s much to consider. So, whether you’re a first-time buyer, an investor, or thinking of selling, here’s a deep dive into Australia’s property scene across its major cities.

Shifting Dwelling Values Across Australia

As we head into the middle of spring, home values were up by 0.4% in September, according to data from CoreLogic, a cool-down compared to earlier months. The national rise in property values was just 1% for the September quarter—marking the slowest growth rate since March 2023. Interestingly, cities like Perth, Adelaide, and Brisbane are still experiencing significant growth, while Melbourne saw a 1.1% dip. These differences underscore Australia’s patchwork property landscape, where each city tells its own story.

What’s Driving These Changes?

Let’s unpack some of the key influences on property prices across Australia:

• Interest Rates: RBA has adjusted interest rates to help manage inflation, affecting how much buyers can borrow and their willingness to invest. Higher rates tend to cool the market, while lower ones spark activity.
  
• Supply and Demand: Population growth and the demand for housing in major cities keep pushing prices up. However, new housing developments aren’t meeting demand, intensifying competition, especially in big cities.
  
• Economic Recovery: As Australia’s economy recovers post-pandemic, job growth in urban centres has bolstered buyer confidence.
  
• Investor Activity: Regulation changes have encouraged more property investors to jump in, adding to the demand.

Growth Trends in Regional Markets

Even regional markets have cooled down a bit recently. The growth rate in the combined regional index dropped from 2.3% (in the three months leading up to April) to 1% in the September quarter. Although prices in regional areas are still rising, they’re not climbing as quickly as earlier in the year.

Property Performance Overview in Major Cities 

Here’s a quick snapshot of property performance across Australia’s main cities. It covers monthly, quarterly, and yearly growth, total returns, and median values for each city:

The national median dwelling price is currently $807,110. For those wondering, that’s $891,639 in capital cities versus $640,243 in regional areas.

A Quick Word of Caution: It’s tempting to think that Perth, Brisbane, and Adelaide have all overtaken Melbourne in terms of value based on recent media reports. However, these figures can be skewed due to the higher percentage of units (apartments) in Melbourne’s housing stock, which brings the median value down compared to other cities where houses make up a larger share.

How Housing Types Vary Across Australia

It’s not just the prices that differ; the types of properties vary widely, too. The percentage of units versus standalone houses differs in every city, influencing the median prices. Here’s a breakdown showing the distribution of units across the country:

The higher percentage of units in Sydney and Melbourne creates different market dynamics, as units tend to appreciate differently from houses due to location and buyer demand.

What’s Happening with Prices Around the Country?

In a word: variability. The Australian property market is anything but uniform, with every city and region exhibiting distinct trends. Here’s a closer look at some of the largest markets and what’s driving property prices there.

Sydney

Sydney’s property prices have defied expectations, showing consistent growth over the last 18 months. But the pace of this rise has started to slow, likely because of increased listings and buyer fatigue. Auction clearance rates remain high, indicating that demand is still robust, and experts expect this demand to keep pushing prices higher.

Median Property Prices in Sydney:

• All dwellings: $1,188,912
• Capital city houses: $1,473,775
• Capital city units: $860,849

Melbourne

Melbourne’s property market hasn’t kept pace with other capitals, which could mean opportunities for savvy investors. Prices have dipped by 0.1% month-over-month, and more homes are on the market now than ever in recent years, creating more choices for buyers. Despite these conditions, there are pockets of growth, especially for high-quality homes in desirable areas.

Median Property Prices in Melbourne:

• All dwellings: $777,390
• Capital city houses: $925,762
• Capital city units: $612,215

Brisbane

Brisbane has seen remarkable growth, with a 66.4% increase in property values since the pandemic began. This surge is partly due to Brisbane’s relative affordability and strong demand for quality homes. Supply hasn’t kept up with demand, and Brisbane’s auction market remains strong, hinting that prices will keep climbing.

Median Property Prices in Brisbane:

• All dwellings: $881,091
• Capital city houses: $973,534
• Capital city units: $661,925

Adelaide

Adelaide’s property market continues to be one of the country’s best performers, thanks to limited supply and high demand. The affordability of Adelaide compared to Sydney and Melbourne has made it attractive significantly as demand outstrips supply. CoreLogic data shows a 69% increase in values since the pandemic started.

Median Property Prices in Adelaide:

• All dwellings: $802,075
• Capital city houses: $856,856
• Capital city units: $564,854

Perth

Perth has taken the lead as Australia’s fastest-growing property market. Prices have climbed by 1.6% in the past month, making it an attractive choice for East Coast investors looking for more affordable options. But beware—many East Coast buyers, unfamiliar with the local market, are paying above the odds. Perth’s market is closely tied to the mining sector, and any fluctuations in this industry could have a significant impact.

Median Property Prices in Perth:

• All dwellings: $797,184
• Capital city houses: $830,965
• Capital city units: $572,007

Hobart

Once a star performer, Hobart’s market has lost some steam. Prices are down 12.5% from their peak in March 2022. Investors are now looking to other markets for better returns, though Hobart still holds appeal for those seeking affordable housing in a scenic location.

Median Property Prices in Hobart:

• All dwellings: $654,302
• Capital city houses: $692,504
• Capital city units: $536,932

Darwin

Darwin is Australia’s most affordable capital for housing, attracting buyers looking for a relaxed lifestyle in a low-density area. Property values rose by 25.3% during COVID-19, but recent growth has been limited, with prices remaining below peak levels.

Median Property Prices in Darwin:

• All dwellings: $492,332
• Capital city houses: $592,507
• Capital city units: $353,742

Canberra

The Canberra property market saw a sharp rise during COVID-19, with values up by 30.8%. However, the growth has tapered off, and prices now sit around 6% below their peak. Interest remains steady, but the market has started to favour buyers, who now have more options than in previous years.

Median Property Prices in Canberra:

• All dwellings: $844,882
• Capital city houses: $966,232
• Capital city units: $618,364

What Does This Mean for Buyers, Sellers, and Investors?

With such regional variations, Australia’s property market offers unique opportunities and challenges depending on your location. Here’s what you should consider based on your property goals:

If You’re Buying

For homebuyers, market conditions may offer chances to secure properties at fair prices, especially in cities like Melbourne and Hobart, where prices have softened. If you’re eyeing Perth or Adelaide, be ready for a competitive environment with limited listings. Remember to check the local rental market if you’re buying to invest; yields in Perth and Brisbane, for example, are strong due to high demand and low vacancy rates.

If You’re Selling

Selling in a high-demand market like Perth, Adelaide, or Brisbane can yield excellent results. But if your property is in Sydney or Melbourne, you might need to prepare for a more moderate sales environment, as these cities are seeing price stagnation or slight declines. Presenting your home well and setting realistic expectations are key to attracting buyers.

If You’re Investing

Each capital city’s unique growth trends and median values make evaluating based on long-term prospects crucial. Perth, Brisbane, and Adelaide currently stand out for their growth potential. High-demand towns with consistent rental demand in regional markets could yield solid returns. Before diving in, consider upcoming infrastructure projects, local economic growth, and rental yield stability.

What’s Ahead for the Property Market?

As we close out 2024, the Australian property market shows no signs of stabilising into a “one-size-fits-all” pattern. Instead, city and regional markets are responding to their local conditions, making it essential for buyers, sellers, and investors to stay informed about the latest trends. If you’re looking to make the most of Australia’s property market, a tailored approach based on the specifics of each area will be your best bet.

Staying updated on interest rate changes, infrastructure projects, and housing demand will keep you ahead of the game. And, as always, expert advice from a mortgage broker or financial adviser can guide you through the complexities of property ownership in Australia.

Navigating Australia’s diverse property landscape can be daunting, but it doesn’t have to be. At RateSeeker, we’re here to help you make sense of the numbers and trends so you can make informed decisions that align with your unique borrowing goals. Whether you’re planning to buy, sell, or invest, our experienced team offers personalised guidance to help you succeed in your home-buying journey.