Housing prices are falling in almost every suburb in Australia’s biggest cities, with values dropping faster in Brisbane than Sydney as the slowdown intensifies.
Prices nationally have fallen ۵.۲% from their peak in March to where they were a year ago, Cotality data released on Thursday shows.
Economists say prices are on track to fall at least ۱۰% after the Reserve Bank lifted rates for the fourth time this year on Tuesday, pushing more buyers out of the market.
Brisbane’s home prices dropped ۱.۵% in September, with every suburb in the city recording lower prices compared with June.
The median Brisbane home was worth $۱.۰۵m, down by $۵۹,۰۰۰ since May. The Queensland capital had seen prices surge ۱۸% over the preceding ۱۲ months.
Sydney median values dropped ۱.۴% in the month and were down ۸.۶% from their record high in March, the equivalent of a $۱۱۲,۰۰۰ drop. Just four Sydney suburbs held steady in recent months.
Melbourne prices were down ۰.۷% since March.
While a handful of suburbs have seen prices continue to rise, Joe Trucchio, a buyer’s agent at Property Home Base, said the downturn had swept the city.
“We’re fully into the spring buying carnival, and we haven’t seen it pick up the way that it had in previous years,” Trucchio said.
“It just takes some time and it takes some good news and right now we’ve had a sequence of bad news.”
Interest rates have become “the biggest conversation” among hesitant buyers, Trucchio said. Comparison website Canstar has estimated this year’s four hikes have cut $۴۷,۴۰۰ from the borrowing capacity of someone earning an average annual full-time wage of $۱۰۸,۶۵۰.
Darwin was the only city to not experience a fall in prices, increasing ۰.۴%.
Housing prices would have to fall roughly ۱۰% to offset a ۱ percentage point increase in interest rates and no suburbs have reached that threshold.
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However, Trucchio said dwellings on the cheaper end of the market had garnered more interest as first home buyers regained confidence.
The Albanese government on Thursday reported over ۱۰۲,۰۰۰ people had been supported with first home loans under the ۵% deposit scheme in the year since it was expanded.
The scheme has supported over ۸,۴۰۰ new first home buyers a month since June on average, relatively stable compared to the ۸,۶۰۰ a month average from October to May.
The RBA governor, Michele Bullock, said on Tuesday the central bank considered leaving rates on hold amid an unexpectedly weak housing market but ultimately decided to lift.
She said falling prices would probably worsen housing supply by making new construction unprofitable.
Economists expect Australia’s shortage of housing will force home prices back up in future, though the receding chance of interest rates cuts has made a longer downturn more likely.
AMP chief economist, Shane Oliver, said the Cotality data supported forecasts of prices falling at least ۱۰% nationally.
“Rate hikes, tax hikes and poor confidence are the big drags but rising distressed listings with rate hikes and rising unemployment do risk a deeper fall of around ۱۵%,’” Oliver said.
