RURAL & AGRIBUSINESS
OPINION: NEW analysis from CoreLogic has identified the recent downturn is being caused by the widening gap between income, borrowing capacity and home values...
After 21 months of growth that pushed values up 14.3%, CoreLogic’s national Home Value Index (HVI) has finally recorded declines. After peaking in October, the national...
The slowdown has been accompanied by other market shifts. Total listings levels across the country finished 2024 5.0% higher than a year ago. Selling times rose through the...
Home values and interest rates are too high for buyers
Housing demand has slowed amid a growing gap between income, borrowing capacity, and home values, exacerbated by slowing economic growth and...
Historically these gaps converge as housing values drop or purchasing capacity improves through higher incomes or lower interest rates. For nearly two years...
Australia’s housing market still looks weaker when accounting for seasonal effects though, and Sydney, Melbourne and Canberra still saw price falls. The national seasonally adjusted...
The downturn is being driven by a relatively small number of markets, but that will change
In December, only five of Australia’s 15 capital city and regional ‘rest of state’...
The national value decline is mainly due to Sydney and Melbourne, which account for roughly 40% of Australian housing stock, and 50% of Australian housing value...
While the downturn is largely driven by Sydney and Melbourne so far, the general market trend is still experiencing a slowdown in most regions. Adelaide had the highest quarterly growth of...
Will this downturn be large?
A cyclical downswing is likely for early 2025 but it may not be large. The largest recorded decline in the national HVI was only -7.7% from October 1982 to March 1983...
Part of this is because sellers may be able to withhold their property from sale until values are rising, effectively restricting available supply during periods of price falls...
Another reason this could be a relatively small market downturn is the tailwinds for property demand in 2025. Growth in real incomes may support more buyer demand as...
Given these factors, the downturn is housing values is likely to be shallow and short lived, but in the same sense, its hard to see any material growth returning to housing values...