However, while prices in Sydney and Melbourne are now slowing down, those in Adelaide and Brisbane still have a way to go.
In December across the capitals, the monthly change in property values ranged from a 0.1 per cent fall in Melbourne to a 2.9 per cent surge in Brisbane.
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Brisbane and Adelaide, along with regional Queensland, were the only broad regions where there was no evidence of value growth slowing just yet, according to new Corelogic data.
“These regions show less of an affordability challenge relative to the larger capitals, as well as better support for housing demand, with Queensland in particular showing strong interstate migration,” CoreLogic research director Tim Lawless said.
“Additionally, we haven’t seen the same level of supply response seen in other regions, with the trend in advertised supply remaining well below average in these markets.”
And, on the other end of the spectrum, momentum has slowed sharply in Melbourne and Sydney markets, with both cities recording the softest monthly reading since October 2020.
“A surge in freshly advertised listings through December has been a key factor in taking some heat out of the Melbourne and Sydney housing markets, along with some demand headwinds caused by significant affordability constraints and negative interstate migration,” Lawless said.
Regions still popular
Regional Australian housing values have seen some renewed momentum with a monthly rise of 2.2 per cent, the highest in nine months.
Regional Queensland was the clear standout across the rest-of-state markets in December, with housing values up 2.4 per cent, however over the year the strongest regional markets were in New South Wales (29.8 per cent) and Tasmania (29.5 per cent).
The most popular regional markets have seen housing values rise more than 30 per cent over the calendar year, with the Southern Highlands and Shoalhaven recording the highest annual rise in home values at 37.7 per cent, followed by Queensland’s Sunshine Coast at 33.7 per cent.
What to expect for 2022
The Corelogic research found a two-speed market was emerging across the state capitals.
While the pace of gains has been easing in Sydney, Melbourne and Perth, conditions across the Brisbane and Adelaide housing markets have gathered momentum.
The slowing trend in Sydney and Melbourne can be explained by a bigger deposit hurdle caused by higher housing prices alongside low income growth.
Slower conditions across the Perth housing market may be a result of lower demand due to state border closures.
In Brisbane and Adelaide, housing affordability is less challenging, advertised stock levels remain remarkably low and demographic trends continue to support housing demand, Corelogic found.