Melbourne’s Housing Market Rebounds this October 2024

Recent data collected shows that home prices across Australia peaked in October 2024. Prices continuously rise in most capital cities, with Melbourne leading the trend. Since the onset of the pandemic, Melbourne has ranked lowest among the capital cities in the property market. The median home price recently hit $797,000, showcasing a 0.3% growth in October and a 5.6% rise during the past year.

Detailed Findings

The following capital cities have shown unexpected signs of growth in the past few months, which became evident in the PropTrack Home Price Index release:

• Melbourne leads the capital cities in housing price growth by 0.5%. The median dwelling price is about $793,000 (the very first rise in six months).
• Adelaide observed a 0.4% gain in October, with the median dwelling price around $783,000. This year also marks the second-largest annual gain for Adelaide, which is 14.9%.
• In New South Wales, the hike was about 0.2% to a median of $728,000.
• Perth also witnessed a slight increase in housing prices by 0.3% in comparison to the previous month (to a median of $773,000).
• The Australian Capital Territory's median price increased by 0.3%.
• Sydney and Brisbane both recorded price gains of approximately 0.2% in October 2024.
• On the contrary, Victoria's regional areas saw prices fall by 0.1% to the median value of $573,000.
• Prices in Hobart and Darwin neither increased nor declined in October.

Comparison between Real-Estate Price Growth in Different Cities

The collected data exemplifies the existing scenario across all major capital cities in Australia below:

Melbourne

• Since the pandemic, housing price growth in Melbourne has been subdued compared to other capital cities. To be precise, Melbourne houses have been cheaper than Sydney throughout the last two decades.

• The ongoing price growth trajectory can be attributed to several factors, including an extensive inventory of properties in Melbourne compared to other cities, higher taxes for investors, and robust construction resources.

• In the current scenario, increased sales volume and rapid turnover of quality properties can be regarded as signs of a resilient market.

Adelaide

• Units in Adelaide have remained more expensive than those in Melbourne. In terms of median price,? Adelaide is at $609,000 compared to Melbourne's $608,000
• Property houses in Adelaide are at a median of? $832,000 (more affordable) compared to Melbourne’s $909,000.
• However, due to a current shortage of homes in Adelaide, property prices have increased.

Sydney

• Prices in Sydney increased by 0.2% in October, driven by the housing segment, while unit prices remained steady.
• Sydney’s median house price has heightened and now stands at $1.45 million.
• Despite the price hike, buyers continue to buy landholdings due to an extensive inventory, highlighting Sydney's resilience amid affordability constraints.??

Perth

• Perth witnessed a 0.3% monthly property price hike in October 2024
• Earlier this year, particularly in February and March, prices in Perth climbed over 2% per month.
• These were all indicators of a rapid growth phase, which is now easing back.

Western Australia

• The Western capital recorded the most substantial annual gain of nearly 20.6%.
• Western Australian regional areas witnessed a slight dip in prices, i.e., 0.2% to a median of $543,000.?

South Australia

• Regional areas in South Australia witnesses a massive price hike in the property marketplace, i.e., a 0.6% rise to a median price of $449,000
• The Barossa - Yorke - Mid North area in SA dominated the upsurge, with a monthly increase of 1.04% of any statistical area 4 (SA4) in the country.?

Queensland

• Prices hiked by 0.3% to a median value of $703,000? in regional Queensland
• It still maintained the position of? being the second-most expensive regional market after New South Wales
• Townsville and surrounding areas recorded the highest gains in Queensland, with prices rising by 0.85% for the month.

Others

Overall, all regional areas combined showcased less housing price growth than capital cities, with a 0.2% increase vs. 0.3% in the capital cities.

On a Final Note

The Melbourne city area has been relatively more affordable in terms of property purchases compared to Sydney, Brisbane, and Canberra. However, housing prices in Melbourne have started to edge up, notably in the inner-north region. The recent shift can be due to the much-anticipated potential interest rate cuts, making Melbourne a more appealing option in the property market.?

According to the economists, while Melbourne’s recent price hike looks promising, a single month of growth may not necessarily mean an enduring upward trend. Melbourne’s value proposition remains strong, though questions about when the first rate cut will occur persist. If buyers take advantage of Melbourne's relative value change, October might be a turning point in the investment market. Additionally, the broader landscape across Australia underscores significant regional differences, with varied supply and demand conditions contributing to uneven growth.?

Hereafter, we recommend buyers and investors keep a keen eye on these shifting dynamics as the market prepares for potential rate adjustments in the coming year.?

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