How did the property market fare in December? CoreLogic reveals all
For the first time since 2018, Australia’s home values have fallen across the calendar year. CoreLogic’s latest index reveals that following December’s results, the year 2022 has registered a 5.2% decrease in total home values.
Apart from marking the first yearly fall in total home values since 2018, the 12 months to December 2022 also saw the sharpest calendar-year decline since the global financial crisis in 2008, when home values fell by 6.4%.
CoreLogic pinned the last-minute slump on the Melbourne market, where home values tumbled by 0.8% in November and another 1.2% in December, although Sydney, Adelaide, Darwin, and Canberra also saw accelerating rates of decline in housing values.
By contrast, Brisbane and Hobart’s rate of decline eased from November to December, while Perth found itself in the enviable position of registering an increase (0.1.%) in housing prices for the second consecutive month last year.
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CoreLogic research director Tim Lawless called 2022 a year of contrasts. Housing values swelled in the first four months of the year then quickly deflated when the RBA tightened its monetary policy at a record pace.
“Our daily index series saw national home values peak on May 7, shortly after the cash rate moved off emergency lows,” Lawless said. “Since then, CoreLogic’s national index has fallen [by] 8.2%, following a dramatic 28.9% rise in values through the upswing.”
Lawless also noted the fact that recent months had seen a smaller performance gap between broad value-based cohorts, when the more expensive parts of the market normally tend to lead upswing and downturn cycles.
“Sydney is a good example, where upper-quartile house values actually fell at a slower pace than values across the lower quartile and broad middle of the market through the final quarter of the year,” Lawless said.
Annually, Sydney had the sharpest home value decline (12.1%), followed by Melbourne (8.1%), Hobart (6.9%), the ACT (3.3%), and Brisbane (1.1%). Only three capitals saw home values rise through 2022, with Adelaide topping the list with a double-digit (10.1%) increase, followed by Darwin (4.3%), and Perth (3.6%).
Although housing values across the regional areas of the country barely moved – increasing by 0.1% – results were mixed across the states, with home value decreases in regional NSW (2.7%) and Victoria (1.3%) offsetting gains across the remaining regional markets.
“Regional SA has been the stand-out for growth conditions over the past year, with values up 17.1% through 2022,” Lawless said. “The well-known Barossa wine region led the capital gains with a 23% rise in values over the calendar year.”
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Despite the market downturn, CoreLogic found that home values generally remained well above pre-COVID levels. In capital cities, values floated almost 12% above where they were in March 2020, while those in the regional markets were still up by 32.2%. Lawless said Melbourne was the only capital city whose downward trend threatened to “[wipe] out the entirety of COVID gains”, with dwelling values only 1.5% above March 2020 levels.