Monthly Housing Chart Pack - September 2024

Almost 30% of suburbs have seen values fall over the quarter

In CoreLogic's Housing Chart Pack, the September ‘Chart of the Month' takes a granular look at value falls over the three months to August, with almost 30% of the 3,655 suburbs analysed across Australia in decline.

Melbourne (79.1%) and regional Victorian suburbs (73.8%) made up the majority of falls over the quarter. Values also decreased across more than half of the suburbs in Hobart (54.3%), Darwin (51.2%), and Canberra (51.6%), while all suburbs in Perth saw values rise over the quarter.

CoreLogic Economist Kaytlin Ezzy said quarterly value declines are becoming more common as high interest rates, cost of living and affordability challenges continue to bite.

"While values are still rising at the national level, albeit at a slowing pace, beneath the headline figure, we're starting to see some weakness, particularly in Victoria."

"In Melbourne, declines were most concentrated in more affluent regions, with 100% of suburbs in the Mornington Peninsula recording decreasing values, while just one suburb in the Inner-South (Carrum) and three suburbs in the Inner-East (Box Hill, Deepdene, Canterbury) saw values rise over the quarter. A similar pattern played out in regional Victoria, with Ballarat (100%), Geelong (97.8%) and Bendigo (89.3%) recording the highest concentration of falls."

Ms Ezzy noted that this fresh view of the data highlighted a creeping weakness in demand, and the variation in market conditions.

“Nationally the portion of suburbs in quarterly decline was 29.2% in August, which has risen from 17.2% a year ago. Behind Melbourne, Sydney has seen the biggest increase in the share of suburbs in decline over the past year, from 3.8% to 25.9%.”

"At the other end of the scale is WA. Of the 146 suburbs analysed across regional WA, 127 recorded a quarterly rise in dwelling values, while all 302 Perth suburbs saw values rise.

“This data shows a remarkable turnaround in the Perth market. In the three months to September 2022, 60.1% of Perth suburbs were in decline. In the three months to August 2024, there was not a single suburb analysed where prices had fallen.

"Across Perth, value increases ranged from a 1.8% rise in Marmion in the city's North-West, to 10.6% in Henley Brook in Perth's North-East."

Looking forward, Ms Ezzy says despite the continued strength in some markets, its likely value declines will become more common as the spring selling season commences.

"The flow of new listings has already been above average through winter, which has translated into slowing growth. We're already starting to see the early signs of a slowdown in markets like Adelaide and Brisbane, with 3.1% and 3.8% of suburbs, respectively, recording falls."

"It's likely this easing will continue into the seasonally busier spring selling period, with additional listing putting further downward pressure on values.”

Other highlights from the September Housing Chart Pack include:

• CoreLogic estimates the combined value of residential real estate rose to $10.95 trillion at the end of August.
• The pace of quarterly growth has continued to ease, to 1.3% in the August quarter. This is down from 2.0% in the three months to April of this year, and down from 3.3% in the June quarter of 2023.
• The change in home values continues to be highly varied across the capital city markets. In the August quarter, mid-sized capitals Perth, Adelaide and Brisbane, alongside Sydney saw values increase, while Canberra, Darwin and Hobart declined.
• CoreLogic estimates there were 40,428 sales in August, taking the national annual count to 513,067. This is 9.3% above sale volumes last year.
• The time it takes to sell property has trended a little higher relative to one year ago nationally. As with capital growth trends, selling conditions vary depending on the market. Properties are selling quicker than a year ago in Perth and Adelaide, with the median selling time at 11 and 27 days, respectively.
• The vendor discounting trend has compressed at the national level compared to last year. Sellers in Darwin (-4.6%) continue to offer the largest discounts across the capitals, followed by Hobart (-4.1%), while stronger selling conditions in Perth has seen the median vendor discount fall to -2.6%.
• In the four weeks to September 1, new listings totaled 39,994 nationally. Despite winter being a seasonally slow period, the flow of new listings is trending 4.0% higher than last year, and 16.7% higher than the historic five-year average.
• While total listing levels have remained fairly subdued, the unseasonably high flow of new listings has seen stock levels accumulate, with the total listing count rising from around -25% below average at the start of 2024 to -12.4% below average.
• Capital city auction activity trended higher over August. Despite the additional supply, the combined capital cities clearance rate averaged 64.3% over the past four weeks.
• Annual growth in rent values slowed to 7.2% nationally, reflecting an incremental easing in the rate of rental growth at a high level. This easing is reflected across the capitals, with the exception of Hobart and Canberra, both of which saw rents decline in 2023.
• Dwelling approvals were up 10.4% in July, the highest monthly uplift since May 2023, and largely driven by a 33.7% lift in unit approvals. The house segment saw a modest lift of 0.3%.
• The value of new housing lending secured rose 3.9% in July. The rise was driven by a solid lift across both owner occupier borrowing (up 2.9%), and investor lending (5.4%). Despite interest rates remaining elevated, the value of residential lending has steadily increased, with the July result being 26.5% higher than this time last year.

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