Home price growth falls to lowest level since start of Covid lockdowns: PropTrack Home Price Index

Home price growth has slipped to its lowest level since the start of Covid lockdowns as growing economic uncertainty begins to bite deeper into the real estate market.

Housing price growth has fallen to its lowest level since the start of Covid lockdowns, as the spectre of an interest rate rise, a spike in the cost of living and economic uncertainty begins to bite deeper into the market

According to the new PropTrack Home Price Index released on Thursday, the increase in home prices across Australia in March 2022 was at it slowest pace since May 2020, after lockdowns were instituted across the country.

Nationally, home prices rose by just 0.34 per cent according to the Index, with Melbourne prices falling slightly by -0.02 per cent. In Sydney values grew just, 0.32 per cent, the slowest rate of growth in a year.

“Home price growth has slowed considerably in 2022,” PropTrack Economist Paul Ryan said.

“The increase in prices across the country in March 2022 was at the slowest pace since May 2020, after national pandemic lockdowns.

Housing price growth has fallen to its lowest level since the start of Covid lockdowns. Picture: Rob Leeson.

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“While price growth has slowed dramatically, it is comparing to an exceptional period – 2021 saw the fastest growth in over 30 years.’

Monthly price growth was highest in South Australia, with Adelaide the top performer of the capital cities, with a 0.84 per cent rise. Values were up 0.49 per cent in Brisbane, the slowest growth since May 2020, down -0.11 per cent in Perth, they rose 0.19 per cent in Hobart but fell -0.61 per cent in Darwin.

Overall, March growth in regional areas at 0.62 per cent was more than double the capital city growth of 0.24 per cent to continue the Covid trend of regional home values rising faster than metro values. Prices have increased 25 per cent in the past year in regional areas, but only 16 per cent in the capitals.

House price growth continues to outpace unit growth, 0.27 per cent. Picture: Nicki Connolly

House price growth, 0.36 per cent for March, continues to outpace unit growth, 0.27 per cent.

“In March, regional areas continued to benefit from relative affordability and preference shifts towards lifestyle locations,” Mr Ryan said.

“Regional areas in all states outperformed their capital city region.

“The slowing in price growth reflects the reduced influence of lower interest rates.

“Fixed mortgage rates have already increased over recent months and larger rises are expected as the RBA increases the cash rate – widely expected later in the year.

“The outlook for price growth remains subdued, with the speed of official interest rate hikes the big unknown for the market in 2022.”

The national median dwelling price sits at $684,000 according to the PropTrack Home Price Index, with the median house price at $748,000 and units at $561,000.

The PropTrack Home Price Index is Australia’s first monthly revised residential property price index providing timely and unique insights to help Australians make the most informed property decisions.

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