There are signs that Australia’s property boom is pulling on the handbrakes, as new data revealed that house price growth in capital cities fell by over 90 per cent during the March quarter.
Domain’s latest Quarterly House Price Report showed that combined capital city house values grew by 0.6 per cent during the first quarter of 2022 – a significant slowdown from the 6.9 per cent increase recorded over the previous three-month period.
The biggest decliners during the quarter were Darwin (-1.8 per cent), Canberra (-0.9 per cent), and Melbourne (-0.7 per cent). This marks the first quarterly fall since the June 2020 quarter for Melbourne and the March 2020 quarter for Canberra.
Meanwhile, some capital cities emerged as new frontrunners during the period. Brisbane (3.1 per cent), Adelaide (3 per cent) and Hobart (4.3 per cent) were the three capital cities to post the strongest quarter-on-quarter growth.
However, Domain noted that the figures are still below the 10.7 per cent, 8.6 per cent and 8.7 per cent that the three cities reported, respectively, over the previous quarter.
Despite the laggard quarterly growth, median house prices still managed to post an annual gain of 18.4 per cent.
This brought the average cost of a house to stand at a record high of $1.07 million — with Perth posting a new record-high house price for the first time since 2014 at $612,926.
On an annual basis, the highest growth was once again seen in Brisbane (32.1 per cent), Adelaide (28.1 per cent) and Hobart (25.5 per cent).
The chilly air sweeping the real estate market did not bypass the unit sector, which saw its first decline since June 2020. The sector fell by 1 per cent during the quarter, with the average cost of an apartment across the country now at $616,942.
Unit sectors in Brisbane (3.1 per cent), Adelaide (1.3 per cent) and Canberra (0.6 per cent) were the only cities to experience a growth in value over the March quarter.
The unit sector continued to lag behind its housing counterpart in terms of annual growth, posting a 4.5 per cent growth during the 12-month period.
Over the year, the cities to see the biggest growth in the sector were Hobart and Darwin, which are both up by 29.8 per cent.
Comparatively, growth in regional Australia has outperformed the cities, with the median house price up by 3.1 per cent over the past quarter and 20.8 per cent over the year.
Weighing in on the data, Domain chief of research Dr Nicola Powell commented the figures are welcome news for buyers.
“These latest quarterly statistics could ease some of the pressure particularly for first home buyers, with annual growth being at a 12-month low.
“While each city’s figures vary, we’re seeing Australia settle into a ‘new normal’, including increased interstate movements, ease of restrictions and return of international workers, which is prompting shifts in the property market,” she added.