After nearly two years of solid growth, house prices are showing signs of cooling. In December, dwelling values dipped by 0.1%, according to CoreLogic’s Home Value Index (HVI). This modest decline follows a broader slowdown that began in June 2024, with average monthly growth falling from 0.6% earlier in the year to just 0.1% in the last quarter.
The decrease in national home values has been driven largely by significant declines in Sydney and Melbourne, where dwelling values dropped by 0.6% and 0.7% respectively in December. As these cities account for approximately 40% of Australia’s housing stock and half of its housing value, their performance has an outsized impact on national trends.
Interestingly, the downturn is not uniform across Australia. While five markets experienced declines in December, others, such as regional South Australia, saw values increase by as much as 1.2%. These regional gains highlight the resilience of certain markets despite broader national trends.
CoreLogic predicts the downturn may extend over the coming months, creating opportunities for buyers to secure property at lower prices. However, this window may be brief. With interest rates expected to drop in 2025 and inflation moderating, buyer demand could rebound, putting upward pressure on prices once again.
If you plan to buy a home while prices are favourable and need a home loan, click here to discuss your scenario with a mortgage broker.