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The highs and lows of Australia’s property prices over the last 30 years

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Over the past 30 years, Australia’s economy has faced financial reform, commodity booms, a global financial crisis, and most recently, the Covid-19 pandemic.

But in spite of all these significant events, our property market continues to strengthen to today’s record high.

According to the Aussie Progress Report, which was commissioned by Aussie and developed by CoreLogic and assesses how buyer demand has developed over the past 3 decades, Australia’s housing market grew a whopping 381.2% between December 1991 and December 2021.

Australian house values increased 414.6% in the past 30 years, while national unit prices grew 293.1% during the same period.

That means 30 years annualised growth for houses and units were 5.6% and 4.7% respectively.

Property prices have ebbed and flowed

Prices2The data shows that over the past 30 years there have been 7 periods of sustained price increases and 7 periods of sustained declines.

Value increases appear to have an average length of 41 months, with average cumulative growth of 34%.

Meanwhile, periods of peak-to-trough declines lasted 12 months and with an average -4.3% fall in prices.

To put this into context, the current national housing market upswing, which started back in October 2020, has lasted 19 months to date.

Annual change in Australia’s dwelling values over the past 30 years

01

1991 vs 2021: How property prices compare in Australia’s top 5 suburbs

As part of the report, CoreLogic has put together lists of the top 5 most expensive suburbs back in 1991 and compared them to the current day.

And the results are surprising.

At the top of the market, Vaucluse in Sydney has maintained its top position as the nation’s most valuable suburb, standing the test of time throughout the past 3 decades.

The data shows that the top 25% of Vaucluse’s dwelling values started at $980,478 in 1991.

In today’s market, the top 25% of dwelling values stand at the enormously higher price of $8,625,930.

Bellevue Hill was the only other suburb to maintain its rank (at number 3) in the high-end dwelling market, where the 75th percentile value rose from $609,723 in 1991 to $6,519,828 in 2021.

Interestingly, the most drastic change was seen in The Rocks in Sydney.

The Rocks sits in second place on the 1991 list with a $644,730 value, but given the same suburb has a value of $2.36 million today it has dropped right down to rank in a mere 175th place for 2021.

Clearly, the city suburb hasn’t kept up with its eastern suburb counterparts.

SuburbiaWhy?

“This dramatic change in The Rocks is likely due to changes in the composition of stock over time, with relatively high levels of construction weighing on the 75th percentile value in the suburb,” the report explains.

Even in the 2020-21 financial year, ABS data shows 520 new dwelling approvals for the SA2 market in which The Rocks is situated.

This compares to 37 in the Rose Bay – Vaucluse – Watsons Bay market, and 0 in Woollahra.

Meanwhile, the Sydney suburb of Bronte has risen from the ashes.

Back in 1991 Bronte sat in 81st place with a $307,769 value but thanks to a surge in demand for Bronte’s beachside living, prices have jumped to around $5.4 million today, meaning the suburb now ranks much higher in 5th place.

That’s an enormous 946.1% increase in property prices in 30 years!

02

And it’s not just the high-end market that has seen such a jump in prices – entry-level suburbs also reveal some surprising statistics.

CoreLogic’s data shows that in both 1991 and 2021, the most affordable suburbs nationwide were recorded in Queensland and Western Australia.

Many of these suburbs are rural, regional areas, with values that are often heavily impacted by resource-based projects and employment.

Stratton and Port Kennedy in Perth, Mount Morgan, Moranbah in Queensland, and Sinclair in Western Australia made up the top 5 most affordable entry-level market suburbs in 1991.

Of the 5, only one has kept its place on the list: Mount Morgan has slipped one place to third in 2021, from second place in 1991.

The suburb had a median value of $29,442 in 1991 which has risen 195.9% to $124,382 in 2021.

The remaining 4 suburbs on the 1991 most affordable entry-level market list enjoyed significant price growth over the 30-year period of between 406.9% and 438.6% each.

Of the list of most-affordable entry-level markets in 2021, the top 2 (Kambalda West and Blackwater) have seen a small 23.3% and 27.1% price growth over the 3 decades.

03

While the most affordable entry-level markets are scattered across Queensland and Western Australia, NSW has seen some of the most dramatic changes in entry-level markets.

The report reveals that the suburb of Carrington in Newcastle saw a 25th percentile valuation of $74,080 in 1991, which reached $943,167 in 2021.

This makes it the suburb with the largest increase in rank across the suburbs analysed, from 1,973 in 1991 to 441st most expensive entry-level market in 2021.

Coastal markets rise in popularity

Other notable shifts in suburb rankings from mid-level to the top 20% of median values have taken place in coastal markets across Victoria, Queensland, and NSW.

Celeb SuburbiaBlairgowrie and Balnarring in the Mornington Peninsula had dwelling values around $112,326 in 1991 while as of December 2021 the average median value in these suburbs is $1.4 million.

At the median value level, the largest change in value rank over the past 30 years across Australia was in the suburb of St Andrews Beach on the Mornington Peninsula which has seen a 927.9% increase in value taking it from 1,732nd place in 1991 to 299th place in 2021.

Elsewhere, Noosaville on the Sunshine Coast has climbed the median dwelling value ranks from 1,333rd place in 1991 to 333rd in 2021.

Saratoga, Erina, Davistown, and Green Point on the Central Coast have also leapt up the median value ranks, from the middle 20% value band of suburbs to the top 20% between 1991 and 2021.

Suburb medians in these Central Coast markets have gone from an average of around $118,000 in 1991 to $1.2 million in 1991.

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