Property Owners Are In Stronger Position than 5 Years Ago

National dwelling values have been trending lower for seventeen months and have fallen by a cumulative 7.4% since peaking in October of 2017. Despite the broad-based weakness, the national index remains 15.9% higher relative to five years ago. This highlighting that most property owners are remaining in a strong equity position.

National Dwelling Value Index _ Source: CoreLogic

Markets where values had peaked much earlier have shown a more substantial downturn. In Darwin and Perth, where the weak housing market conditions were driven by the weak economic and demographic conditions post mining boom – dwelling values have fallen a cumulative 27.5% and 18.1% since peaking 2014. The silver lining here is that housing is now very affordable, and first home buyers are proportionally much more active in these areas relative to other areas of the country.

On the other hand, dwelling values remain at record highs across Hobart and regional Tasmania, and only marginally lower in Canberra, Adelaide and Brisbane, as well as regional Victoria.

Although housing market condition remain relatively healthy in these regions, conditions have noticeable softened over the past 12 months with values either slipping or the pace of growth slowing materially.

Since Brisbane peaked in April 2018, the capital’s dwelling values have fallen by just 1.6%. A small fall in comparison to the fall of all capital cities combines which have fallen 9.2% since peaking in September of 2017.

Change in Dwelling Values from market value_ Source: CoreLogic