The Australian housing market has showcased remarkable resilience, recording extended growth through the end of 2024, marking the longest period of consistent quarterly growth since the years 2012-15.
Cities like Brisbane, Adelaide, and Perth reported unprecedented highs in both house and unit prices, with Sydney units also reaching new records.
The strength of the market was particularly visible in the more affordable capital cities and the unit sector, with significant increases noted across the board.
In 2024, standout performances were seen in more affordable capital cities and the unit sector; Perth led the way in house price gains with a 19.5% increase, followed by Adelaide at 14.6%, and Brisbane at 10.9%. In the unit market, Perth again led with a 28.2% rise, followed by Brisbane at 18.1%, and Adelaide at 13.6%, Domain reported.
Despite reacceleration in the price growth during the December quarter, the overall pace has slowed, indicating a shift towards market stabilisation.
Quarterly growth for house prices in the combined capitals has decreased by more than half compared to the same quarter the previous year, and unit growth has slowed by approximately 25%.
As listings increase, the dynamics are shifting to favour buyers, as evidenced by the highest December listings in three years, particularly pronounced in Sydney.
The expanding inventory is resulting in softer clearance rates, extended time on the market for properties, and increased price negotiations – evidence that the market is increasingly favouring buyers.
Nicola Powell (pictured above), Domain’s chief of research and economics, provided insights into the changing dynamics.
“This is a milestone for Australia,” Powell said, concerning the rising house prices. “In terms of housing market dynamics, it’s a psychological hurdle for buyers. When you edge over that million dollars, it just feels different.”
Powell also commented on the broader impacts of Sydney’s high property prices: “It begs the question of the extreme rates of property prices that we have in Sydney: What are the broader impacts of that geographically?”
Reflecting on the market outlook, Powell said, “We’re likely to see these softer or slowing market conditions in the autumn selling season.
“The slowdown is largely due to affordability pressures, with rising prices making it harder for many buyers to keep up. Wages haven’t kept up with home prices, and the ongoing cost-of-living squeeze is only adding to the challenge.”
Dive into the full Domain report here.
