The Australian property market is showing signs of a slowdown, with national dwelling values rising by just 0.4 per cent in September, according to the latest CoreLogic data.
The September quarter saw a 1 per cent increase in the national Home Value Index (HVI), marking the lowest quarterly rise since March 2023 when the market was in the early stages of its current upswing.
CoreLogic’s Research Director, Tim Lawless, said a significant increase in property listings was a key factor in the market’s deceleration.
“The rise in real estate inventory is a seasonal trend, with spring and early summer one of the busiest periods of the year for selling,” Mr Lawless said.
“However, the flow of freshly advertised housing stock hasn’t been this high at this time of the year since 2021.”
The slowdown is particularly evident in some capital cities, with Melbourne experiencing a 1.1 per cent decline in dwelling values over the quarter.
Canberra, Hobart, and Darwin also recorded falls.
Even in Sydney, where values continue to rise, the quarterly growth of 0.5 per cent was the lowest since February 2023.
Mid-sized capitals, which have led growth through most of the upswing, are also losing momentum.
Perth’s quarterly growth eased from 6.2 per cent to 4.7 per cent, while Brisbane’s slowed to 2.7 per cent.
The increase in listings has led to softer market conditions for sellers.
Auction clearance rates have dropped to the low 60 per cent range across combined capital cities, below the decade average.
Properties are also taking longer to sell, with the median time on market increasing to 32 days nationally, up from 29 days in the June quarter.
Affordability constraints continue to drive stronger performance in lower-priced markets.
Lower quartile dwelling values in combined capitals have increased by 12.4 per cent over the past year, compared to just 3.8 per cent for upper quartile properties.
Looking ahead, Mr Lawless expects further growth in housing values, but at a slower pace and with increasing diversity across markets.
“If the first month of spring is anything to go by, purchasing activity isn’t keeping pace with the flow of new listings,” he said.
“A further rise in advertised supply is good news for buyers, but for vendors, it means more competition and the potential for a softening in selling conditions.”
He said while factors such as improving sentiment, tight labour markets, and expectations of future interest rate cuts may support the market, persistent affordability challenges and potential tightening of credit conditions could act as headwinds in the coming months.
