This is exactly how much house prices are changing in every Australian capital city — revealing this year's biggest property winners and losers

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  • New analysis of Australia’s capital cities by Domain has revealed how much house prices have moved in 2019 and suggested where to for each.
  • Melbourne’s property market looks to be turning around since slumping in 2017, recording its first quarter of growth since. Sydney’s slowdown appears to be bottoming out too as declines shrink.
  • Prices in Brisbane, Perth and Darwin all continue to decline, while Canberra remains flat for the year.
  • Meanwhile, after a few strong years, Adelaide and Hobart appear to be losing some momentum as prices continue to drive higher.

Australia prides itself on its diversity, and one glance at the latest property data shows the capital cities are experiencing very different headwinds.

The latest analysis by property group Domain shows exactly how the different capital cities are faring — some in the midst of multi-year booms, others on a downward spiral.

Some capitals like Sydney and Melbourne are easing after riding one of the most significant property booms this country has seen. Others like Hobart still look like having a way to run. There’s a glimmer of hope for long-struggling Perth, while Darwin looks to be still out of luck.

Here’s how each capital is travelling in terms of median property prices.

Sydney

It’s no secret Sydney has been on the decline since booming up until mid-2017. Over the past 12 months, house prices shrunk by 9.1% while units are down 7.1%.

The good news for owners and investors is the pace of decline appears to be slowing. Houses and units both fell by a relatively modest 0.4% this quarter, indicating they may be nearing the bottom.

Since their peak two years ago, house prices have fallen by 11% back to early 2016 levels, while units have dropped by 14%, bringing prices back to mid-2015.

“This turnaround has been triggered by the Reserve Bank cutting interest rates twice, an election result meaning there will be no changes to negative gearing rules, and the banking regulator changing a key lending rule that will enable people to borrow more,” Domain concluded.

Melbourne

Likewise, Melbourne appears to be on the up after following Sydney through a price rout.

Median house prices are down 10% since their 2017 peak and by as much as 16% in the city’s most expensive inner-east and inner-south areas. Units, meanwhile, are just 2% down on their peak.

That was helped by the fact that this quarter actually saw property prices rise — house prices by 0.3% and units by a much stronger 2%.

However, just as the expensive suburbs have fallen faster, they now appear to be rebounding.

“Notably, auction clearance rates in Melbourne’s most expensive regions in recent weeks are the strongest of all city regions. Melbourne’s more expensive regions tend to lead the overall market, so this is another sign that the Melbourne market may be nearing the bottom,” Domain said.

While the recent ride has been a wild one, it’s not as bad as it seems. House and unit prices, for example, remain 49% and 20% higher respectively than they were in 2013.

Brisbane

Compared to its southern neighbours, things are looking brighter in sunny Brisbane. House prices fell just 1.4% this quarter, totalling a 2% decline since their mid-2018 peak.

Less positive is the track record for the city’s apartments, owing in no small part to a construction spree that created an oversupply, leading prices to fall this quarter by 3.1% and 11% since their 2016 peak.

To put that in perspective, that means investors who bought a unit in 2013 and are looking to sell today could expect to make zero profit.

Coming years should be kinder to sellers, Domain assures.

“As fewer apartments will hit the market in late 2019 and 2020, there will be less downward pressure on prices. Strong population growth has meant the correction in unit prices was not as severe as some had predicted,” it said.

Adelaide

The South Australian capital, in contrast with the eastern seaboard, has actually been on the rise, averaging 4% house price growth every year between 2013 and 2018.

This year that growth looks to slow, with house prices up just 1.4% this year, after they fell by 0.1% this quarter — the first quarterly fall since 2014. Units are up just 0.6% in 2019.

Despite that growth, Adelaide still ranks as the third most affordable city to purchase a house and the second cheapest city to buy a unit, only pipped by Darwin.

Domain expects the upward trajectory to continue regardless, given that “buyer interest has picked up following the election and interest rate cuts will provide a boost to the market”.

Perth

While Sydney and Melbourne might complain the loudest, spare a thought for Perth where the recovery has yet to appear.

Prices have been falling since their 2014 peak, with houses down 14% and units down 19% from their highs. The slump has been driven by “sluggish population growth, a slowing economy after the mining boom and more recently, tighter lending conditions”, according to Domain.

This quarter saw both houses and units fall 2% and 1.6% respectively, but Domain reckons there might be some light at the end of the tunnel.

“A number of signs indicate price falls could be close to ending. Population growth is picking up (although from very low levels), interest rates are lower, more people are attending open for inspections, the mining outlook is now much stronger, there is a growing demand for workers and unemployment is expected to fall,” it concluded.

Despite that optimism, those who have waited five years for a recovery that never came will believe it when they see it.

Darwin

When it comes down to it, however, Perth’s slump doesn’t come close to Darwin’s — the city that has the dubious honour of being home to the worst recent property crash in the country.

That looks unlikely to change either, with house prices falling 2.3% this quarter, bringing them 26% lower than their 2013 peak. The median house now goes for $502,500, the second-cheapest in the country.

Units have fallen 10.4% over the last 12 months and are almost 40% down since their 2016 peak. That makes Darwin the cheapest Australian capital to buy a unit by a margin.

Unlike Perth, there aren’t even hints of a recovery anytime soon.

“Darwin house and unit prices have been crunched by the end of the mining boom, a slowing economy and a declining population. Even with lower interest rates, it’s possible prices will fall further this year,” Domain said.

Hobart

Hobart, meanwhile, has had a meteoric rise in recent years although that now looks like its boom might be finally slowing.

Median house prices increase 0.7% this quarter and 3.9% this year, marking their smallest increase since 2016. Unit prices, which have shot up 24% since 2016, are down 1.5% this year.

That boom was off relatively low prices, however, meaning that despite the growth, Hobart is still the most affordable capital city to buy a house in the country.

So what’s in store?

“Price growth is likely to be modest in the year ahead as Hobart’s relative affordability compared to other capital cities has declined, and more home building will add to the supply of housing,” Domain said.

Canberra

Canberra’s property market this year meanwhile echoes a common complaint among visitors to the city — there’s not much happening.

House prices in the capital jumped 1.5% this quarter, returning prices to where they started the year.

Units have risen 1.9% this year. Median unit prices are at $48,700 and continue to fluctuate between the $400,000 and $460,000 marks as record construction continues.

Slow and stable appears to be the name of the game, with Domain expecting that “lots of new apartment building will keep unit prices from rising too much”.

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