Annual decline in national home values largest on record

Annual decline in national home values largest on record

By Eliza Owen, Head of Research, CoreLogic Australia

Each month CoreLogic Australia’s research team compile a comprehensive summary of the need-to-know market metrics.

This month’s highlights include:

Ø  Dwelling values in Australia are -7.9% lower over the past 12 months, the largest annual decline on record.

Ø  The combined value of residential real estate in Australia rose to $9.3 trillion at the end of February, from $9.2 trillion in the previous month but well below the peak of $10 trillion in April 2022.

Ø  Despite a large annual decline in home values, the monthly pace of decline slowed quickly over February to just -0.1%.

Ø  The highest annual growth rate in dwelling values among the regional and capital city dwelling markets was across Regional SA, at 13.2%. The lowest change in values was across Sydney, where home values declined -13.4% in the past year.

Ø  The rolling 28-day change in the combined capitals home value index was 0.0% in the 28 days ending 7 March.

Ø  Sales volumes continue to trend lower as buyer demand slows. CoreLogic estimates that in the 12 months to February, there were 486,620  sales nationally, down -21.2% compared to the previous year.

Ø  At the national level, properties are taking longer to sell. In the three months to February, the median days on market was 41, up from a low of 20 days in the three months to November 2021.

Ø  Vendor discounting also expanded through 2022. However, in the three months to February, the national median vendor discounting rate contracted slightly on the three months to January.

Ø  In the four weeks to 5 March 2023, the volume of new listings totalled 38,479 nationally. While new listings have seen a seasonal lift, new listings are still -12.7% lower than the previous five-year average.

Ø  The combined capital cities clearance rate averaged 65.8% in the four weeks ending 5 March 2023. While this was a much stronger result than in the final weeks of 2022 (averaging 55.1%), auction volumes are still low relative to where they were this time last year.

Ø  Annual growth in rent values held steady on the previous month in February, at 10.1%. Annual growth in Australian rent values was 10.2% in the 12 months to December, a record high. The most rapid annual rise is evident in unit rents across Sydney, Melbourne and Brisbane, where rents have increased around 14 to 17% annually.

Ø  The chart of the month shows a turn in the tide of supply for Hobart. Monthly listings volumes are 73.4% higher than a year ago, as properties take longer to sell, and listings volumes move toward the decade average.

Auction Market Preview – week ending 12 March 2023

By Caitlin Fono, Research Analyst, CoreLogic Australia

The Melbourne auction market is significantly quieter this week due to Victoria’s Labour Day long weekend, with 358 homes currently scheduled for auction, down -61.4% from last week (927) and -41.1% lower than this time last year (608).

Across the smaller capital cities, Brisbane is set to host the most auctions this week (111), up 2.8% from last week (108). Adelaide (80, down from 119) and Canberra (61, down from 108) are both expecting to see auction volumes drop week-on-week, thanks in part to their public holidays on Monday. In Perth, 15 homes are currently scheduled for auction, up from nine last week, while there is just one auction scheduled in Tasmania, in line with last week and this time last year. Over the same week last year, auction volumes across the smaller capitals were higher with 181 homes taken to auction across Brisbane, 155 in Adelaide, 84 in Canberra and 17 in Perth.

Summary of last week’s final results

There were 2,054 homes taken to auction across the combined capital cities last week, compared to 2,429 over the previous week and 2,979 this time last year. The final clearance rate came in at 66.3% last week, down just 50 basis points from the previous week when 66.8% of auctions were successful. This marks the third consecutive week where the final clearance rate has held in the high 60% range. This time last year 69.2% of auctions were successful.

For the full Auction Market Preview, which includes a summary of last week’s clearance rates, please see the attached PDF.

For more information contact media@corelogic.com.au.

Join the conversation on LinkedIn, Facebook, Instagram and Twitter.