Home prices drop in Melbourne, Hobart, Darwin, and Canberra suburbs

Recent data from CoreLogic reveals a significant shift in Australia's property market, with home prices declining in a majority of suburbs across four capital cities—Melbourne, Hobart, Darwin, and Canberra—over the three months leading to August. Melbourne is particularly affected, with 79.1% of its suburbs experiencing price drops, while Hobart follows with 54.3%. The median home price in Melbourne has fallen 4.9% from its peak in March 2022, coinciding with a series of interest rate hikes by the Reserve Bank. The decline in property values is attributed to several factors, including the highest interest rates in over a decade, a cost-of-living crisis, and affordability issues that have dampened demand for new homes. In Geelong, an alarming 97.8% of suburbs saw price reductions, and Ballarat reported a complete decline in home values. Hobart's mid-point home price has dropped 12.2% since its peak, reflecting a broader trend of decreasing property values in Tasmania. Conversely, other cities like Perth and Brisbane are witnessing growth in home prices, driven by interstate migration and a recovering economy. Perth's prices have surged by 22% over the past year, while Brisbane has only seen a 3.8% decline in its suburbs. Sydney, despite being the most expensive market, has also seen a decline in 25.9% of its suburbs, although its median price has increased by 5%. Overall, the national trend indicates that 29.2% of the suburbs analyzed have experienced a drop in values, highlighting a two-speed property market in Australia. The Reserve Bank's decision to maintain a high cash rate suggests that relief from these economic pressures may not be forthcoming in the near future.