Sydney home values have declined by -10.1%, or roughly $116,500, since the city hit its peak value in February, according to CoreLogic’s daily home value index.
The double-digit fall follows six consecutive OCR hikes and record-low affordability after a spike of 27.9%, or roughly $252,900, in the city’s dwelling values from the COVID trough to peak.
Tim Lawless, CoreLogic research director, said it was unsurprising Sydney was leading the capitals in the current downturn considering that it was the nation’s most expensive capital city housing market and arguably has the greatest susceptibility to rising interest rates.
“Although Sydney’s housing values were already in decline when the rate hiking cycle began, the pace of decline accelerated sharply following the first interest rate increase in May,” Lawless said. “Sydney values are now down -9.5% since 3 May, and -10.1% since peaking on 13 February this year.”
Melbourne’s value drop ranked second to Sydney, down -6.4% since Jan. 14, while Brisbane slipped -6.1 % since its June 19 peak, the daily index showed. Both Adelaide and Perth declined less than -1% since their August peaks.
CoreLogic’s monthly Home Value Index shows Hobart and Canberra down -4.7% and -4.4%, respectively, since their month-end peaks. Darwin remains the only capital city where housing values haven’t started to trend lower, although dwelling values remain -10.1% below its record high in 2014.
“Despite the -10.1% decline so far, Sydney home values still have a way to go before wiping out the capital gains accrued over the recent growth cycle,” Lawless said. “Home values would need to fall a further -11.4% to get back to the levels seen at the onset of COVID. The good news for Sydney homeowners is that the rate of decline has continued to moderate through October, improving from a -2.2% decline over the four-week period ending 3 September to -1.3% over the most recent four-week period ending 23 October.”
