National home values record largest decline on record: CoreLogic

According to CoreLogic’s Monthly Housing Chart Pack for March 2023, this decline is the largest annual decline on record. The total value of residential real estate in Australia rose to $9.3 trillion at the end of February 2023 from $9.2 trillion in January, however, this is far below the peak of $10 trillion recorded in April 2022.

This was a larger drop than what was recorded in the housing chart pack for February that reported a 7.2 per cent drop in national dwelling values. This was the largest annual home value decline seen since May 2019.

Despite this, the monthly pace of decline has slowed over February to 0.1 per cent, although CoreLogic stated that it is uncertain whether this trend will continue in the wake of further interest rate rises this year.

Five of the capital cities recorded declines in dwelling values over the last 12 months, with Sydney leading the declines at 13.4 per cent, bringing it 13.5 per cent below the record high of January 2022.

This was followed by Hobart, which recorded an 11.8 per cent annual drop, Melbourne with a 9.6 per cent decline, Brisbane at 6.8 per cent, and Canberra with a 6.7 per cent drop.

Adelaide, Darwin, and Perth recorded increases in dwelling values over the last 12 months of 5.1 per cent, 2.9 per cent, and 2.4 per cent, respectively.

Overall, the highest annual growth rate in dwelling values out of the regional and capital city dwelling markets was across regional South Australia at 13.2 per cent.

Further data has shown that sales volumes have continued to trend lower due to slowing buyer demand.

CoreLogic has estimated that in the 12 months to February, national sales volumes have declined 21.2 per cent (or 486,620 sales) when compared to the previous year.

Total regional sales recorded a drop of 22.5 per cent for this period, while total capital sales were down 20.4 per cent.

Monthly sales volumes were averaging 37,020 over the past six months, down from an average of 40,155 over the past five years.

High-end regional markets losing steam

CoreLogic’s Regional Market Update for January 2023 recorded only 13 areas that saw increases in house values over the year, down from 21 over the year to October 2022.

For instance, the upmarket coastal and hinterland Richmond-Tweed region in NSW recorded the weakest performance across all metrics, registering the lowest annual growth rate (down 18.6 per cent), as well as the largest drop in sales volumes (36.1 per cent in the year to November), longest days on market (71 days), and highest vendor discounts (down 8.3 per cent).

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