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  • Home prices push towards all-time highs in September

Home prices push towards all-time highs in September

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Few forecasters could have dreamed it in 2022 when interest rates were soaring, but Australian property prices are again fast approaching peak levels. 

Strong lifts were seen in the five biggest capital city markets over September as spring selling season activity ramped up.

Find out if we'll be hitting new all-time high prices before the year's out.

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National property prices: September 2023

Australia's median home price got another +0.8 per cent boost last month according to CoreLogic's latest data

That brings total gains to +6.6 per cent from the national low point back in January. That's within 1.3 per cent of the all-time high recorded in early 2022. 

MarketMonthQuarterAnnualMedian value
Combined capitals0.9%2.5%5.1%$814,204
Combined regional0.4%1.1%0.4%$591,632

Sydney prices jumped up another +1.0 per cent over September, bringing the median home value comfortably back over $1.1m, while Melbourne's more gradual run continued with gains of +0.4 per cent. 

Brisbane edged towards record highs with growth of +1.3 per cent, while Adelaide and Perth extended their new peak levels with +1.7 per cent and +1.3 per cent respectively. 

Darwin and Canberra held more-or-less steady with nominal gains for the month, with Hobart being the only capital city to record a decline of -0.6 per cent. 

Regional markets once again fell behind their city counterparts but still saw a combined increase of +0.4 per cent. 

CoreLogic's research director Tim Lawless explained that national prices are expected to return to all-time-high levels within the next two months. 

"We have already seen dwelling values reach new record highs in Perth and Adelaide," he said.

"Brisbane looks set to reach a new record high in October, with home values currently only 0.6 per cent below their previous peak."

Listings are rising, but only in some markets

Sydney and Melbourne saw listings begin to climb from deep lows throughout winter, and that trend has continued into the spring. 

Sellers have been returning to the market since June. Source: CoreLogic

Hobart and Canberra have followed suit; total available stock in both cities, plus Melbourne, is sitting at above-average levels. 

The opposite is happening in Brisbane, Adelaide and Perth where total listings are around -40 per cent down on the five-year average.

Total available stock on the market is still well down in most markets. Source: CoreLogic

The volume of home sales was up +6.3 per cent on the five-year average, although Mr Lawless warned that continuously rising prices could put future sales at risk. 

“Housing affordability is still relatively stretched and is getting worse as home values continue to rise," he said.

"High interest rates make it harder to qualify for credit, especially when considered alongside high cost of living pressures and the three percentage point serviceability buffer."

Regional markets are still climbing at a slower pace than the capitals

While some of the capital cities have seen explosive price growth over 2023, things have been moving at a more measured pace in the regions. 

The combined regional markets showed a +0.4 per cent uplift in September with mixed results between the states. 

MarketMonthQuarterAnnualMedian value
Regional NSW0.5%0.8%-1.8%$704,609
Regional VIC0.0%-1.0%-4.0%$560,774
Regional QLD0.6%2.3%3.6%$583,215
Regional SA-0.2%2.8%9.3%$385,243
Regional WA0.8%1.7%6.2%$441,703
Regional TAS-0.5%-0.4%-1.6%$504,899
Combined capitals0.9%2.5%5.1%$814,204
Combined regional0.4%1.1%0.4%$591,632

Looking at quarterly movements, South Australia, Queensland and Western Australia have all experienced strong growth for the month. 

NSW, Victoria and Tasmania have had slower years so far, each recording annual declines. 

The regions have experienced more modest growth than the capitals in 2023. Source: CoreLogic

Mr Lawless noted that listings have mostly held below average across the regions, though sales are down too.

"Softer housing conditions across regional Australia looks to be more demand-driven, with the estimated number of home sales 6.5 per cent lower than a year ago and 9.2 per cent lower relative to the previous five-year average," he said. 

Even so, 2023 has seen property prices rise +2.6 per cent over 2023 so far in the combined regions.

What's next for Australian property? 

Despite listings increasing in some markets, CoreLogic's report predicted that Australian home values would be hitting new all-time highs before the end of November. 

According to their regional subdivisions, almost a third of the country has already broken into new peak price territory, and future indicators look positive. 

Buyers are still being restricted to some degree by challenging barriers to entry for the property market. 

"A rise in consumer sentiment, a drop in interest rates or an easing in credit constraints would all be factors supporting a rise in purchasing activity. However, we haven’t seen any evidence of these events occurring," the report read.

Even so, record population growth is underpinning demand at a time when approvals for new builds are at the lowest levels since 2013, so fresh supply should continue to be limited. 

"While an undersupply of housing is clearly negative, insufficient levels of housing are likely to support housing values over the medium term."