Sept 2023 Analysis of Australia's Property Market Based on Data-Driven Insights

In September, CoreLogic's national Home Value Index had a 0.8% increase, with Adelaide, Brisbane, and Perth emerging as the frontrunners in capital gains. The housing market's performance in any city is intricately linked to the dynamics of its supply. As an illustration, the supply levels in Hobart currently exceed the five-year average by 40%, although the national index has experienced a recovery of 6.6% since the month of January.

It is worth noting that regional markets are experiencing slower growth than capital cities, as seen by a 1.1% increase in home prices during the September quarter. The observed increase is less than 50% of the growth observed in the aggregate capital city market, which recorded a rise of 2.5%.

The housing recovery in Australia is robust, as seen by the national dwelling prices being only 1.3% below their previous peak. During the initial three quarters of the year, there was a notable rise of 7.4% in the values of capital cities, while regional values had a comparatively modest gain of 2.6%.

Nevertheless, the current perspective is full of obstacles. The issue of housing affordability continues to be a matter of concern, as seen by the increasing ratio of home values to household income. The duration necessary to save funds for a down payment is also increasing, intensifying many individuals' challenges associated with property buying.

The future trajectory of the market will be determined by the levels of supply that are marketed. If the ongoing increase in new listings persists, prospective purchasers may experience a more favourable situation, characterised by a greater variety of options and enhanced bargaining power.

Economic conditions, interest rates, and labour market trends will significantly influence the property landscape. Despite encountering particular challenges, it is anticipated that the problem of housing undersupply will continue to exist, potentially bolstering house values in the medium run.