A graph has revealed the grim reality for Australians trying to break into the housing market, with prices in one city soaring 15 per cent in 2023.
Despite five interest rate hikes by the Reserve Bank in 2023 and cost-of-living pressure, house prices rose nationally 5.52 per cent over the year.
Figures released in PropTrack’s latest Home Price Index on Tuesday reveal house prices in all cities are expected to climb in 2024, with a graph showing the incline in the new year.
After hitting a fresh peak in November, combined capital city prices fell 0.09 per cent in December, marking the first and only decline of the year.
Across December, prices fell in Sydney, Melbourne, Hobart and Canberra, but Perth, Adelaide, Brisbane and Darwin recorded strong growth.
Proptrack economist Anne Flaherty said multiple factors contributed to the slowdown of house prices in the last quarter of 2023.
“There was an additional interest rate rise as well as an increase in the supply of homes listed for sale, which provided buyers more choice and helped to alleviate competition,” she said.
“Even though recent months have seen a rise in the number of properties listed for sale, overall supply remains relatively constrained, particularly in Perth and Brisbane. This has been a key contributor to price rises in these markets.”
Ms Flaherty said house prices in 2024 would be supported by population growth and a more stable interest rate environment.
PERTH
Perth had the strongest performing property market across the year, recording the highest growth of any capital city.
House prices in Perth reached a new high in December, rising 0.69 per cent, with a 14.75 per cent jump over the year.
The main reason prices have soared is because buyers have limited choices, resulting in properties attracting higher levels of interest and selling at “close to record speeds”.
ADELAIDE
House prices in Adelaide reached a new peak in December, rising 0.59 per cent over the month, bringing the total growth across the year to 10.89 per cent.
Adelaide is the second strongest performing market behind Perth across 2023.
The affordability of properties in Adelaide is a key contributor to its growth.
BRISBANE
Brisbane house prices also rose 0.27 per cent and reached a new peak in December, bringing the total growth over 2023 to 10.45 per cent.
High levels of population growth have supported the demand for housing in the Sunshine State, especially post-Covid.
This means Brisbane was one of the strongest performing capital city markets, with the median home price now sitting 57 per cent higher than March 2020.
SYDNEY
House prices across the country’s largest city fell 0.08 per cent in December after reaching a record high in November.
December is the first time prices have fallen in Sydney in 13 months, with values down across both houses and units.
Despite the drop, prices remain close to peak levels and sit 7.72 per cent higher than 12 months ago.
MELBOURNE
Melbourne house prices fell 0.55 per cent, the second sharpest monthly fall behind Canberra.
Prices rose just 0.89 per cent over entire year, remaining 4.6 per cent below peak levels in March 2022.
Victoria’s capital city has been home to the weakest performing property market in the four years since Covid, with prices sitting 15.5 per cent higher than March 2020.
HOBART
House prices in Hobart have been dropping for close to two years and declined by a further 0.41 per cent in December.
Hobart was the weakest performing capital city over the year, with prices down 3.5 per cent and 8.18 per cent lower than its peak in March 2022.
The state’s abnormally high levels of growth between 2020 and 2021 was driven by strong buyer demand.
Since 2021, demand has dropped and prices have corrected in response.
DARWIN
Prices of properties in Darwin edged up just 0.1 per cent in December, with a median value of $482,000.
Compared with the beginning of 2023, Darwin’s median house price is sitting 1.49 per cent lower and remains 2.26 per cent lower than the peak in May 2022.
CANBERRA
Canberra was the weakest performing capital city in December, with house prices falling the most at 0.66 per cent.
Prices across the market in the capital city are up just 0.25 per cent on 12 months ago, remaining 5.86 per cent lower than their peak in March 2022.
REGIONAL
While national house prices held steady in December, growth in regional areas counteracted falls in capital cities.
Prices grew 0.23 per cent and reached a new peak of 3.2 per cent for the year.
The key drivers of growth in regional areas were Queensland and South Australia, up a respective 0.51 per cent and 0.5 per cent in December.