Australian house prices turn two-speed


ANZ Bank senior economist Adelaide Timbrell says higher mortgage interest rates appear to have weighed on house price growth in Sydney and Melbourne in recent months.

She adds that this trend is likely to continue in early 2024. The bank has downgraded its house price growth forecast for Sydney in 2024 to 4-5%, compared with previous expectations of 6-7%.

ANZ House Price Forecast

Source: The AFR

Melbourne prices are, in turn, now expected to rise by 2-3%, down from ANZ’s previous forecast of 3-4% growth.


ANZ maintained its forecast for Brisbane at 9-10% price growth this year and nationally at 5-6%.

ANZ also upgraded its price growth forecasts for Adelaide (8%) and Perth (10-11%).

“We’ve seen very strong results in Perth, Adelaide and Brisbane in the past few months because they have more shortages in available housing, whether that’s for sale or for rent”, Timbrell said.


“This means there’s going to be more competition and an increase in price pressure for both rentals and purchases”.

NAB likewise lowered its price forecast for Sydney and Melbourne and upgraded Brisbane, Adelaide and Perth.

NAB house price forecast

Source: The AFR

CoreLogic research director Tim Lawless noted the potential for upside surprises in Sydney and Melbourne owing to the strong rebound in clearance rates across both markets.

Auction clearance rates

“Potentially, there could be an upside surprise given that we’ve seen a pretty strong start to the year in sales”, Lawless said.

“Housing values seemed to be responding more positively to the rebound in auction clearance rates based on a daily index since the start of the month”.


“The rebound in clearance rates probably points to higher prices in the coming months, as we’ve seen a very strong relationship between clearance rates and the trajectory of housing values”.

“So it’s definitely pointing to some upside for Sydney and Melbourne”, Lawless said.

Indeed, CoreLogic’s daily dwelling values index recorded stronger growth across Sydney and Melbourne in February; although price growth is still lagging the other major markets:

CoreLogic daily index

As shown above, Australian house prices are two-speed, with the two biggest markets lagging behind Brisbane, Perth and Adelaide.

About the author
Leith van Onselen is Chief Economist at the MB Fund and MB Super. He is also a co-founder of MacroBusiness. Leith has previously worked at the Australian Treasury, Victorian Treasury and Goldman Sachs.