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Property market update

2 September 2019 | 7 min read

How do you know what’s happening in the market and when it’s the right time to buy?

Buying a house can seem like a daunting task.

Trying to save for your deposit.

Getting your auction game ready.

Family telling you now is the right time to buy while your friends say just wait a few more months.

So how do you know when it really is the right time to buy? 

David Robertson, our Head of Economic and Market Research, breaks down the current state of the property market highlighting key trends for our capital cities.


For housing markets – borrowing rates, both fixed and variable, have fallen again thanks to the latest rate cut from the RBA.

While Melbourne and Sydney have just experienced their largest fall in housing prices since World War II with a 12-15% decline from the 2017 highs, there are a few signs that it may now start to level off and hopefully find a base.

Beyond the two largest capitals, the falls were less dramatic over the last year and some regions actually rose quite strongly including Canberra, Hobart and a number of regional locations.

Even with these large falls, it is worth keeping in mind that most housing prices are still well above where they were five years ago, with the exceptions being Perth and Darwin which were most impacted by the mining boom that peaked around five years ago.


For the past decade, the Sydney housing market has broken all records with unprecedented property value rises. It peaked in late 2017 and recent CoreLogic data reports that the market has fallen 9% in the past twelve months providing some hope for potential buyers.

Having fallen around 15% from the peak, with regular falls month after month, we have finally seen a small rise for the average Sydney house price in July and the jump in auction clearance rates seems a very encouraging sign.

In fact, the Sydney auction clearance rate has doubled from around 40% at the start of this year to just above 80% – although on low auction volumes.

From here the market faces a long road back to the old peaks, and in some respects it will be good if we take our time to get back to those dizzy heights – but the latest RBA rate cuts and a few other factors including the regulator relaxing some of the policy settings should add some stability to prices in Australia’s largest city.


Similarly, the Melbourne market has dropped around 8% over twelve months, providing a glimmer of hope for buyers looking to make a move.

The 12% fall from the Melbourne peak in the last few years has attracted plenty of media attention. Although the prices have varied greatly suburb by suburb, high rise apartments and units have been more steady than detached dwellings despite fears of an oversupply – so population growth in Australia’s second largest city has been an important factor.

At the same time that Melbourne’s median house price suffered its largest fall since the 1930s, a number of regional cities including Ballarat, Shepparton and Bendigo actually experienced gains. Overcrowding in the capital has encouraged people to the regions with their promise of cheaper relative prices and all the lifestyle advantages of more room and less traffic.

House prices in the regions and in Melbourne appear well positioned to benefit from the recent rate cuts, tax cuts and the fastest population growth in the country.


The Brisbane market saw house prices fall about 2.5% over the previous twelve months with pricing dropping 2.9% since their peak in April 2018.

Price movements have been far more stable over the last decade in Brisbane compared to other cities making it clear that the sunshine state has been less exposed to the recent market volatility than the southern capitals.

There has been healthy population growth in Brisbane and a range of regional locations and this trend of a steady consistent price incline looks well positioned to continue.

The Queensland economy is also benefitting from the lower Australian dollar helping tourism and other service exports, so the market may well remain beautiful one day and perfect the next…


Darwin has seen a significant drop in prices with house values down around 9% from where they were twelve months ago and almost 30% from five years ago.

This significant fall needs to be put into context of the previous decade where the market enjoyed a record rise, thanks to the mining investment boom and specific events like the Ichthys LNG project.

The Northern Territory economy is likely to benefit from tourism and the lower Australian dollar in the short to medium-term. However it is an economy that is very dependent on mining and the government sector meaning the jobs and housing market will remain volatile.


The nation’s west has also experienced a significant drop in housing prices since their peak.

While the Perth housing market has fallen around 9% in the past twelve months, housing values have fallen 20% in total from their peak in June 2014.

The decline is only on top of a massive upswing leading up to 2014, thanks to the commodity boom and associated mining investment boom.

So now that commodity prices are back on the ascent and with signs of a pick-up in local investment, the decline may well be behind us, and population trends may start to revert back to the West.


The housing market in Adelaide remains steady with less than a one percent decline over the past year.

The city of churches has experienced a far steadier and more reliable rise in prices over the last few decades than in other capitals as the economy has steadily grown but at a relatively modest pace.

Like other states, South Australian property will welcome the development of lower borrowing rates and the recent tax cuts. Being a state that enjoys healthy levels of tourism the lower Australian dollar will help the economy and jobs outlook.

The relativities of cheaper median prices in Adelaide housing compared to the eastern states is a big help in attracting demand from interstate.


Housing prices rose around 1.5% in the nation’s capital over the last year however values have eased around 1% from their peak in April 2019.

The ACT economy has the lowest unemployment rate of any Australian state or territory which, when combined with steady population growth and economic growth, has created a positive environment for property.

Being the second strongest capital city over the last year for house prices there are hopes this trend can continue and the recent surge in first home-owner activity suggests this may well be the case.


The Tasmanian housing market has been one of the strongest across the nation and Hobart is clearly the best capital city with an increase over the past twelve months of around 3%.

The longer term trends have also been really strong for Hobart housing prices, which are up on average 36% over the last five years.

The relativities of what had been much more affordable housing in Tasmania (although the gap has been bridged) partly explain this outcome, as well as population growth and the lack of housing supply that had been evident – although this trend may be starting to moderate.

Interstate demand (especially from investors) has been a large part of the equation, as well as retirees trading in property from more expensive markets, but it is unlikely the growth rate will be as strong in the immediate future for the apple isle.

So, what’s the final word?

From here, low interest rates, the recent tax cuts and less policy uncertainty has seen a sharp rise in auction clearance rates.

A more benign steady incline, for house prices, would be helpful.

Over the longer-term property prices typically rise, so best to consider this market for its main purpose; a roof over your head, rather than getting too caught up in the ebbs and flows of the price movements.

Equally, don’t assume that housing prices will always go up – or once they start to fall, that they will keep falling forever!

Data sources: RBA, CoreLogic.

Any advice provided in this article is of a general nature only and does not take into account your personal needs, objectives and financial circumstances. You should consider whether it is appropriate for your situation. Please read the applicable Product Disclosure Statement(s) on our website before acquiring any product.

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