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PropTrack Home Price Index – July 2022

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of PropTrack Home Price Index indicates that July’s price decline widened further across the country, with only South Australia and Western Australia bucking the decline. Sydney and Melbourne are now down more than 3% from his peak.

Key highlights from the July 2022 report include:

  • Australian house prices fell -0.43% in July and are now 1.66% below their peak.
  • Prices continued to fall in Sydney (-0.70%) and Melbourne (-0.59%), both markets down more than 3% from their peak.
  • Only South Australia and Western Australia experienced price increases in July. Prices rose slightly in Adelaide and Perth – the only capital cities to see price increases.
  • Adelaide and regional South Australia recorded new price peaks in July, in contrast to the nationwide decline.
  • Despite recent price drops, the region remains up nearly 50% since the start of the pandemic. The capital has increased by almost 30%.
  • Prices have started to fall broadly in rural areas, with prices falling in local markets in all eastern states. The combined region fell 0.18% in July, putting him 0.5% below the price peak set for April 2022.

price drop across the country

Domestic prices are now down 1.66% from their March peak. Falling prices are impacting all markets except South Australia in 2022.

The RBA’s massive rate hike has pushed rates up by 1.25 ppt since May and is widely expected to rise further from early August onwards. With these rising borrowing costs, he expects home prices to continue to decline from late 2022 through 2023. PropTrack Real Estate Market Outlook for many.

However, these price declines follow the strong rise of the past two years. Since the pandemic began, the provinces have risen by almost 50% and the capital by almost 30%.

All Eastern Province regional markets posted declines in July

The regional market outperforms the capital, with prices up 16.5% over the past year, compared to the capital’s 5.7%. These areas have benefited from relative affordability and post-pandemic lifestyle changes in preference for location and larger homes.

However, the drop in prices has spread across the regional markets and is currently down 0.5% from its peak, with all regions on the East Coast seeing a drop in July.

Sydney and Melbourne are now down more than 3% from their peak

The most expensive markets – Sydney, Melbourne and ACT – lead the price decline. Higher mortgages in these regions could mean higher interest rates, and the uncertainty about how much interest rates will rise has had the biggest impact on these regions. .

Prices in Sydney and Melbourne are down more than 3% from their peak. Prices in Sydney have risen only 2.5% over the past year, while Melbourne has risen 2.4% over the same period.

Brisbane and Adelaide remain the strongest markets over the past year, with prices up 21%. There continues to be a wide gap between capital and rural growth, with more affordable regions recording smaller declines so far.

Houses and units fell by similar amounts nationwide in July. But the post-pandemic period has been marked by a desire for more space, with housing prices (over the year he rose 9.5%) outstripping units (up just 3.5%).

The region with the highest demand in the country achieved 20% growth

All of the country’s fastest growing regions, mainly located in rural Queensland and Adelaide, have grown over 20% in the past year. It is clear that areas around Brisbane continue to benefit from population migration north, with Australians taking advantage of remote jobs and more affordable prices.

Looking at the capital as a whole, the perimeter of the city clearly performs better. With larger homes and a reduced need for commuting, these areas have performed strongly since the outbreak of the pandemic.

Outlook

Domestic prices have now fallen for the fourth month in a row, with prices continuing to fall across much of the country in July. So far, prices have fallen 1.66% from their peaks nationwide, with Sydney and Melbourne seeing the biggest drops of just over 3%.

Price growth has slowed sharply, with annual price growth dropping from 24% just eight months ago to 8.5% today.

Further rate hikes could continue to push house prices down, especially in Sydney and Melbourne.Photo: Getty


Adelaide was the only capital market to record a new price peak in July, while South and Western Australia still recorded higher prices. However, we consider this to be temporary. Even these markets are likely to see lower prices in the coming months.

Strong inflation forced the RBA to sharply raise interest rates at the fastest pace since 1994. A further significant cash rate hike is widely expected in his August and late 2022. This has severely constrained borrowing capacity and increased borrowing costs.

On this basis, we expect price declines to continue, particularly in Sydney and Melbourne. Brisbane, Adelaide and rural areas of the country are expected to outperform, spurring changes in relative affordability and tastes, but tightening financial conditions will again lead to sustained price declines. expected to be View July issue PropTrack Real Estate Market Outlook Learn more about the extent of price drops PropTrack expects across the country.

In the long run, increased investor activity and immigration could benefit large cities. Changes in tastes since the pandemic have made both inner-city locations and apartments relatively cheap, making up the type of housing favored by investors and recent immigrants.

As has become apparent in recent months, uncertainty about the speed of wage growth, interest rate rises, and the extent of rises over this cycle remains a key unknown for prices going forward.

* PropTrack Home Price Index It measures monthly changes in residential property prices across Australia and provides a current view of property market performance and trends. The PropTrack Home Price Index uses a hybrid methodology that combines repeat sales and hedonic regression. Repeat sales match resales of the same property, while hedonic regression estimates values ​​based on those of similar properties. The hybrid model matches two of his properties of the same type within the same Australian Bureau of Statistics Statistical Area 1 (SA1) region and allows control for differences in property characteristics like hedonic regression. The PropTrack Home Price Index is a revised index whose entire historical history is updated monthly with current transaction information.

** This report is realestate.com.au Internal data and data provided by third parties, including state government agencies. At the time of publication. This report provides general information only and is not intended to constitute advice. When citing or referencing this report (or the findings or data contained therein) in a publication, please refer to the report as “PropTrack Home Price Index Report – July 2022”. look report Copyright and legal disclaimers.

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