Timing the market? Here’s where Australia’s cities and towns sit on the ‘property clock’
Housing markets are cyclical, and while the nation’s two biggest cities have come off the boil, other parts of the country are heating up.
Timing the market is notoriously difficult, but the latest report by property valuation firm Herron Todd White (HTW) sheds light on where Australia’s major metropolitan and regional housing markets are at in their property cycles.
Approaching 12 o’clock – the “peak of the market” – on HTW’s national house price “property clock” are the Sunshine Coast, and Hobart. CoreLogic said house prices in the Tasmanian capital shot up by 6.8 per cent over the past year to the current median price of $489,811.
Dubbo, Gippsland, Lismore and the Mid North Coast – including the three main townships of Port Macquarie, Taree and Forster – are at the peak of their cycles, while Bendigo, Central Coast, Coffs Harbour and the Gold Coast are “starting to decline”, HTW found.
Peaks and troughs
Unsurprisingly, Australia’s two most populous cities, Melbourne and Sydney, are firmly positioned at 3 o’clock – the “declining market” phase – alongside Illawarra, Newcastle, south-east Western Australia and south-west NSW.
The cooling Sydney and Melbourne markets have led national home price declines, with both cities experiencing median house price falls of 11.5 per cent over the 12 months to February 28.
CoreLogic pegs Melbourne’s median house price at $729,392 and Sydney’s at $888,117.
After years of steep falls, including a 6.7 per cent plunge over the past year, Perth – where the median house price is $461,890 – is now “approaching the bottom of the market”, HTW said.
Darwin remains firmly planted at the “bottom of the market” despite a slight 0.2 per cent rise in house prices over the past year, alongside Toowoomba, Alice Springs, Rockhampton and Bundaberg.
Brisbane, where house prices fell 0.4 per cent to $538,849 over the past year, is at the “start of recovery”, alongside Ipswich, Mackay, Gladstone, Townsville, Hervey Bay and Cairns.
Traditionally affordable Adelaide, where the median house price rose by 0.9 per cent over the past year to $467,684, leads a host of rising markets, including Canberra, where house prices rose by 4.1 per cent annually to a median of $665,701.
The value of the median price
When it comes to “gauging the state of a property market”, while the median price is a trusted measure, it “may not necessarily give you an accurate assumption of market trend”, HTW cautioned.
The median tool should “only be used as an indicative methodology” and potential purchasers should “always rely on their own due diligence”.
“Real estate statistics, in general, can offer some assistance for the property investor, first-home buyer and upgrader,” HTW said.
“However, it should be noted that the median price statistic does have its limitations within a smaller country or regional town where the variety of housing type is relatively wide and the volume of sales activity is significantly lower than their coastal-based cousins and large metropolitan areas.”