CoreLogic’s daily dwelling values index, which measures price changes across the five major capital cities, fell another 0.12% in the week ended 19 May, which follows the 0.11% decline over the prior week:
This fall was driven by Sydney (-0.27%) and Melbourne (-0.18%), which more than offset price rises across the other major capitals:
So far in May, Sydney (-0.46%) and Melbourne (-0.34%) house prices have fallen sharply, again more than offsetting value gains across the other major capitals. Across the combined five capital cities, dwelling values are down 0.11% over the month:
Quarterly value growth across both Sydney (-1.0%) and Melbourne (-0.5%) is negative. However, strong growth across the other major capitals has still driven the combined 5-city index 0.6% higher over the quarter:
Finally, both Sydney (-0.4%) and Melbourne (-0.2%) house prices are lower over 2022, but these falls have been more than offset by turbo-charged growth across Brisbane and Adelaide (both up 9.0%), and solid growth across Perth (+3.6%). Combined, home values are 1.7% higher over this calendar year:
Given Sydney and Melbourne are Australia’s most expensive capital city markets with the most indebted households, they are also most sensitive to interest rate hikes. So expect both markets to suffer significant house price falls over the remainder of 2022 and 2023.
How far will depend on how aggressively the Reserve Bank lifts interest rates.
