Home values drop for the first time in nearly 2 years

Outlined in CoreLogic’s Home Value Index (HVI) for December, values are down 0.1 per cent over the month.

This marks the end of a strong two years for home values across the country, which CoreLogic says have been growing since February 2023, witnessing a peak in October 2024, and holding flat in November.

Higher interest rates, a tough cost of living and reduced borrowing capacity have all been identified as influencers of these trends.

“This result represents the housing market catching up with the reality of market dynamics. Growth in housing values has been consistently weakening through the second half of the year, as affordability constraints weighed on buyer demand and advertised supply levels trended higher,” CoreLogic research director Tim Lawless said.

The first half of 2024 fared much better than the second, with home values rising 4.1 per cent. The second half, however, saw this growth slow to 0.7 per cent.

According to the HVI, Australian home values were up 4.9 per cent in 2024, adding around $38,000 to the median value of a home.

Melbourne saw the biggest drop in values, falling 3 per cent over the year. Hobart and ACT also saw a decrease, dropping 0.6 per cent and 0.4 per cent, respectively.

Despite the three outlier areas, the others saw increases in value. Perth led the charge with a substantial 19.1 per cent jump over the year. Adelaide followed with growth of 13.1 per cent and Brisbane with 11.2 per cent.

While Sydney saw growth of just 2.3 per cent throughout 2024, it still remains the most expensive city, with a median house price of $1,191,955.

This is far higher than the average median of $814,837. For regional areas, the median was $657,652 (up 6 per cent) and for capitals it was $896,372 (up 4.5 per cent).

Meanwhile, Adelaide overtook Perth as the strongest market. Toppling the consistent western state, Adelaide values grew 2.1 per cent over the last quarter of 2024. In contrast, Perth’s climbed 1.9 per cent and Brisbane’s grew 1.3 per cent.

“Extremely low advertised stock levels have continued to support strong growth conditions across Adelaide, with stock levels tracking -34 per cent below the previous five-year average in mid-December,” Lawless said.

“Perth, on the other hand, has seen a clear lift in advertised supply, which has provided buyers with more choice and less urgency, supporting a sharper slowdown in value growth relative to Adelaide.”

Jack Campbell is the editor of Broker Daily. After graduating from the University of Wollongong in 2022, Jack began his journalistic career working on Broker Daily’s sister brand, HR Leader. In August 2023 he was made the news editor and worked alongside some talented journalists writing articles and recording podcasts.

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