CoreLogic’s January home value results were officially released on Wednesday and showed that dwelling values nationally have fallen 8.9% from their peak, with the combined capital cities down 9.6% and the combined regions 7.4% lower.
Sydney is leading the decline nationally, with values down 13.8% from their peak. This is followed by Hobart (-10.8%) and Brisbane (-10.7%):
Two markets – namely regional South Australia and regional Western Australia – are at their cyclical peaks. Thus, they have brushed aside the Reserve Bank of Australia’s (RBA) uber-aggressive rate hikes.
While Melbourne’s dwelling values have only declined 9.3% from peak, it is the one major capital city where values have all but surrendered their gains over the pandemic.
As illustrated in the next chart, Melbourne dwelling values were only tracking 0.4% above their March 2020 pre-pandemic level at the end of January:
This means that Melbourne dwelling values will likely erase all of their pandemic gains over the coming fortnight, based on CoreLogic’s daily dwelling values index.
Since Melbourne was most heavily impacted by lockdowns over the pandemic, its housing market experienced a relatively sedate rise in house prices. This meant that Melbourne home values now don’t need to decline as far to surrender all of these gains.
By contrast, Sydney (-13.8%) and Brisbane (-10.7%) have experienced sharper corrections in response to the RBA’s rate hikes. But because these two markets experienced much stronger value growth over the pandemic, prices still remain well ahead of their March 2020 level.
As shown above, Sydney dwelling values were still 7.4% above their March 2020 level as at end-January, whereas Brisbane’s were 29.4% higher.
Across the 5-city aggregate level, dwelling values were still 9.9% above their March 2020 level at the end of January.
