Melbourne’s property market has seen a decline in home values for six consecutive months due to increased tax burdens on investment properties. Meanwhile, nationally, home values have been on the rise for the past 19 months, with a 0.5 percent increase in August, according to CoreLogic.
Different cities have shown varying performances, with Perth leading in capital city growth with a 2 percent increase, followed by Adelaide at 1.4 percent and Brisbane at 1.1 percent. Consequently, Melbourne’s median dwelling value has fallen behind Adelaide and Perth, making it the third-lowest among capital cities.
According to the CoreLogic report, this is the first time since February 2015 that Perth’s median has surpassed Melbourne’s, and the first time in CoreLogic’s 40-year history that Adelaide’s median is higher than Melbourne’s. However, the high growth seen in Perth, Adelaide, and Brisbane may not be sustainable due to affordability pressures, interest rates, and labor market conditions.
Demand has shifted towards lower-priced properties, with unit values outpacing house values in five of the eight capitals. While Sydney saw a modest 0.3 percent rise, Canberra, Melbourne, and Darwin experienced declines. The gap between demand and supply is narrowing, with Melbourne’s total listings higher than the five-year average, while Perth and Adelaide are down by more than 40 percent.
The pace of growth across the country is slowing, with a quarterly increase of 1.3 percent, less than half of the growth seen in the same period in 2023. Despite the slowdown, the housing market is expected to see modest value increases through the end of 2024.
Rent growth has also slowed nationwide, with CoreLogic’s rent index remaining unchanged for a second consecutive month in August. Rent values rose by 7.2 percent nationally in the year to August, marking the slowest growth rate since May 2021. Demand factors, such as a drop in net overseas migration and international student arrivals, have contributed to the slowdown.
Overall, while there may be relief in sight for renters as rent growth stalls, the property market continues to face challenges such as affordability constraints and supply-demand imbalances. Please rephrase this sentence.
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