Real Estate Investment:Today

These are the types of properties hit the hardest

Key takeaways

Australia’s pandemic property boom looks like it has come to an end.

2-bedroom houses in Melbourne have fallen the most.

In contrast, prices for all-size houses in Brisbane, Adelaide, Canberra, and Hobart remain robust with all reporting price increases over the same period.

1-bedroom units in Perth have fallen the most.

While rising investor activity could improve demand for more affordable homes, upsizing buyers remained the largest market segment.

It is likely that house prices will continue to grow more than apartment prices.

Australia’s pandemic property boom looks like it has come to an end, with new figures showing house and unit prices either stagnated or fell for the first time since the June quarter of 2020.

And the price shift, amid jitters over rising interest rates, has affected some types of properties more than others.

2-bedroom houses in Melbourne have fallen the most

Melbourne’s house prices dropped 0.7% last quarter to about $1.09 million, the Domain data shows.

But, the median price for smaller 2-bedroom houses fell a much more significant 10.5% over the same period to a new median of $710,000.

That was sharper than the quarterly decline seen for three-bedroom (-4.5%) and four-bedroom houses (-5.7%).

And it was a similar story in Sydney.

Sydney

Sydney’s median house price stagnated with just a 0.2% increase to $1.59 million median in the last quarter, according to Domain data.

But, the median for 2-bedroom houses fell a larger 5.2% (or $51,500) to $940,000.

There was a smaller 2.7% decline recorded for 3-bedroom houses in Sydney and a 2.9% decline for 4-bedroom houses.

01

Interestingly, 2-bedroom houses in Sydney also saw weaker performance than larger homes in Perth and Brisbane.

Perth also experienced a 1.4% decline in prices for 2-bedroom houses, with Darwin reporting a 0.5% decline in prices for 3-bedroom houses.

In contrast, prices for all-size houses in Brisbane, Adelaide, Canberra, and Hobart remain robust with all reporting price increases over the same period.

1-bedroom units in Perth have fallen the most

In the unit market, Perth’s 1-bedroom apartments have seen the biggest price drops with a 7.4% decline over the first quarter.

The same can’t be said for the remainder of Perth’s unit market though – 2-bedroom units have risen 0.7% and 3-bedroom units have risen by 1.7%.

02

Elsewhere, unit prices in Melbourne and Sydney have fallen across the board.

In Melbourne, prices for 1-bedroom units have dropped 5.9% over the first quarter, 2-bedrooms have fallen 1.7% and 3-bedroom units have stagnated with no change.

And in Sydney, 1-bedroom units have dropped 1.5%, 2-bedroom units have dropped a larger 4.9% and even 3-bedroom units have fallen 3.5%.

Buyers have become ‘more selective’

In a Sydney Morning Herald article, Nicola Powell, chief of research and economics at Domain, said that buyers became “more selective” in their property search during “softening markets”, predicting that the forecast cooling of the housing marketing in Sydney and Melbourne will have a “greater impact on fewer premium homes”.

Related Articles

Leave a Reply

Your email address will not be published.

Back to top button