Of the 3720 house markets analysed, 96 suburbs or 2.5 per cent, have recorded a decline in prices since the growth peaked in March this year.
Across the unit sector, 83 suburbs out of 1392, or 6 per cent, have posted a drop in median price during the same period.
“Clearly the unit sector is showing a larger portion of suburbs where housing values have declined since the onset of COVID-19,” said Tim Lawless, CoreLogic research director.
“Perhaps surprisingly, the largest declines in unit values haven’t been concentrated within the inner-city high-rise precincts of Melbounre or Sydney; rather some of the largest drops in unit values have been around the outer fringes of the capital city metro areas where higher density housing has historically been less common and demand is generally more skewed towards low-density housing options.”
In Melbourne, house prices in the western suburbs of Cairnlea, Aintree, Wyndham Vale and Truganina have weakened the most in the state, rising by a total of just 2.2 per cent on average over the past six months – well below Melbourne’s 10 per cent growth during the same period.
House prices in Sydney’s south-western suburb of Gledswood Hills and Bungarribee in the west have posted the slowest growth across the state since March with just 4.9 per cent and 5.3 per cent respectively. This contrasted with Sydney’s house price growth of 16.3 per cent in the past six months.
In Brisbane, house prices in Yarrabilba in the Logan-Beaudesert region and Spring Mountain in Ipswich rose just 3 per cent each over six months. During the same period, Brisbane house prices surged by 13.2 per cent.
High supply
The high supply of house and land packages in these suburbs is likely to have dampened growth, despite strong demand for detached homes, said Jeremy Sheppard, head of research at Select Residential Property.
A total of 526 new homes in Truganina are currently listed for sale on Domain, and there are 400 in Wyndham Vale and 318 in Airntree.
“The stock on market in these areas is currently around four times the national average and oversupply like that is a real killer of capital growth,” Mr Sheppard said.
Similarly, Domain listed a total of 559 house and land packages in Gledswood Hills in Sydney and 409 in Spring Mountain in Brisbane.
“Gledswood Hills is a house and land package area, formerly serving first-home buyers, but with prices rocketing from $800,000 to over $1 million in the past 12 months, it’s no longer affordable,” Mr Sheppard said.
“Nothing subdues demand like a sky-high price range. As such, sales growth has fallen off a cliff from being 50 per cent a year ago to being down 25 per cent now.”
However, Mr Lawless said that considering housing values were generally rising in most regions of the country, a broad-based decline in house prices was unlikely.
“We aren’t expecting to see a rise in the number or proportion of suburbs where housing values are trending lower just yet,” he said.
“The cue for a weakening in housing values more broadly is likely to be when interest rates start to rise, or potentially earlier if we see a more severe tightening in credit policy.”
In the unit market, Raceview in Brisbane’s Ipswich region and Morley in Perth’s north-east posted the largest decline in value across the country with drops of 15.9 per cent and 6.1 per cent respectively.
Unit values in Ardeer, Albion and South Kingsville in Melbourne’s west lost 5.8 per cent, 4.6 per cent and 2.6 per cent respectively, while those in Cabramatta in Sydney’s south-west fell 1.1 per cent.
