Melbourne has begun 2024 as Australia’s house price donkey.
CoreLogic’s daily dwelling values index shows that Melbourne is the only major capital city market to be experiencing negative monthly price growth, with values falling at a 28-day rate of -0.3%:
PropTrack’s rival dwelling values index showed that Melbourne values had fallen for two consecutive months, down -0.2% in November and -0.7% in December:
Meanwhile, according to the Real Estate Institute of Victoria (REIV), the median metro Melbourne house sale price never stopped falling on a quarterly basis after peaking in Q4 2021:
Source: REIV
The weakness in Melbourne home values should continue in 2024 given it experienced the largest rise in new (+19.3%) and overall (+9.6%) listings in the year to December 2023 across the major capitals:
Source: CoreLogic
In addition, Melbourne’s auction clearance rate collapsed over the second half of 2023, from a peak of 70% in June to 57% in December:
As shown above, auction clearance rates have historically been a strong leading indicator for price growth.
Therefore, the weakness in the auction market, combined with the swelling in listings, suggests that Melbourne home values will continue to fall in the months ahead.
