Shock home value growths and losses reveals a divided nation

House prices have fallen in almost 2000 suburbs across Australia, with one down a whopping $485,601. Find out what it means for your area.

New PropTrack data paints a picture of a country divided, with home prices in some markets racing ahead and others in freefall.

According to PropTrack’s automated valuation model – which values homes by analysing a range of data points for a given property, including sales history – the majority of suburbs or towns in three states or territories experience a house or unit value decline over the past quarter.

The data shows house or unit prices in 55 per cent of all Tasmanian suburbs or towns the company has data for dropped for the quarter, while 62 per cent of those in the ACT also experienced value drops.

But the most challenged market was clearly Victoria, with 79.5 per cent, or 770 of the 969 suburbs it has data for, recording a value drop over the past quarter.

The greatest value loss was for houses in Bronte, NSW, where prices are down $485,601 or 7.8 per cent over the past three months to a $5.733 median.

The biggest growth was found in Cottesloe, WA, where the median house value is up $232,659 over the past three months.

Conversely values were up in the majority of suburbs or town in the remaining states and territories, with South Australia, Queensland and Perth the nation’s top performers.

House or unit values rose in 90.5 of all SA suburbs or towns, with values up in 92.4 per cent of all Queensland suburbs or towns.

But the national darling is Perth, with values up in 485 (or 94.2 per cent) of its 515 suburbs.

PropTrack economist Anne Flaherty said seeing such mixed results across the nation was fascinating.

Ms Flaherty said it was essentially a matter of the markets where values were up being undersupplied, and those that have seen a value decline being understocked.

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Home prices across Adelaide have surged in some areas, and plummeted in others. Pic: Supplied

“If you think about the broader economic drivers of property prices, with interest rates being the biggest one, they impact all states pretty much equally, so the fact that we’re seeing such significant differences across the states against the same economic drivers comes down to that balance of supply and demand,” she said.

“If we look at Perth, Adelaide and Brisbane, were really seeing an excess of demand relative to the supply of homes for sale.

“That means it’s still a really competitive market for buyers, with buyers having to put in offers fast and put in competitive offers to be successful in buying a property.

“On the other hand in Melbourne, there’s a huge amount of properties for sale at the moment, so buyers have a lot more breathing room and can be a lot more conservative in putting their offers in and can take their time a little bit more compared to other markets.

She said, regardless of the state, it was Australia’s most affordable regions that were proving to be the best performing.

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Lilisha Malla and husband Lawrence Chan outside their new home in Davoren Park, which has experienced significant value growth over the past quarter and year. Picture: RoyVPhotography

“What we’re seeing is the suburbs that are the most resilient and seeing the strongest price rises tend to be in more affordable areas,” she said.

“And I think with interest rates being so high and it being so difficult for people to save a deposit particularly first homebuyers – a growing share of the total pool of buyers are now looking at these more affordable suburbs, so we are seeing stronger demand in the more affordable areas – and that’s in both our weak and strong performing markets.”

However she said this increased demand meant there was a chance they could no longer be the affordable pockets they are as buyers were priced out them.

“We’re seeing a growing share of suburbs moving beyond the reach of buyers,” she said.

“It’s really challenging for a lot of people to get into the market and we’re seeing more and more suburbs ticking over into that million-dollar club.

“So those affordable pockets, they may not be so affordable for too much longer.”

It’s a trend Ms Flaherty expects to continue.

“We know housing affordability is not going to go away anytime soon and if anything it’ll become less affordable as time goes on and the reason for this is we’re not building enough homes to meet demand, our population is growing more rapidly than the supply of new housing.

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Josh Dufficy and Melanie Cook recently snapped up their first home in Sydney after facing much less competition than they expected. Picture: Thomas Lisson

“It’s safe to assume that home prices as a whole will continue to rise in the long term and more and more suburbs will move beyond the reach of the average buyers.

Edge Realty’s Mike Lao said Adelaide’s northern suburbs had traditionally been affordable, and still offered the state’s, and in some cases the nation’s, most affordable housing.

However, like many other places around Australia, that was changing.

“The growth has been extraordinary,” he said.

“When I started in 2008, houses in Davoren Park were between $100,000 and $200,000.

“In 2019 they were still $100,000 to $200,000 and now some of them are selling for more than $700,000.

“Undoubtedly there are a lot of people being priced out of the area now with this growth.”

Retail manager Lawrence Chan, 33, and his supermarket supervisor wife Lilisha Malla, 27, have recently built a home at Davoren Park, in South Australia, and Mr Chan says he was happy to hear of the suburbs solid growth – with house values up 8.8 per cent for the quarter and 30.9 per cent over the past 12 months.

“The [SA Government’s] stamp duty exemptions allowed us to bid higher and will really help get more young people into the market,” Mr Chan said.

“It’s a fantastic family-friendly area and I think there’s quite a bit of room for the suburb and prices here to grow yet.”