Sydney's property market in historic fall – nine.com.au – Nine

Sydney's property market is in a groundbreaking fall, with $181,000 shaved off the median value of a house.
Although the short-term data shows the market downturn is slowing, when measured over 12 months the New South Wales capital and Canberra recorded their steepest ever annual house price declines.
The latest Domain House Price Report, for the December quarter, shows that Sydney's housing market downturn lost pace over the last three months of 2022, not dropping at the same depth as previous periods.
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However, house prices in Sydney have slipped backwards for three consecutive quarters and this has produced the deepest annual house price decrease in the city's history, with the ACT in the same boat.
House prices in Sydney (trickling down to a new median of $1,413,658) now sit 11.3 per cent below the peak of the cycle, which was reached in March last year. Sydney, after Melbourne, was one of the first markets to experience rocketing prices, Domain's chief of economics and research Dr Nicola Powell said, and is further along in its downward cycle that other cities.
Sydney buyers in the hunt right now will discover that houses have returned to the prices they were in mid-2021. However, houses still cost 24.2 per cent more today in Sydney than before COVID-19 struck.
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On a national level, unit prices peaked earlier than houses over the pandemic and this is reflected in the new medians. The combined national median house price of $1,008,988 is $66,000 below the March 2022 peak and unit prices – at a national median of $596,771 – are $27,000 below the December 2021 price crescendo.
House prices across the combined capitals are still 25.4 per cent higher and unit prices are 5.1 per cent higher than before the pandemic boom.
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Dr Powell said the "shock" of rolling interest rate rises, high inflation and the cost of living have impacted prices in the later portion of 2022. Previous steep price increases could not be sustained by the circumstances now facing property buyers and sellers.
"We have seen that momentum lost over December, but it does depend on the capital cities," she said.
"We are still in a downturn, but we have seen some momentum lost. And shedding that type of price, which we saw over the September quarter – for back-to-back quarters – would be quite an astonishing feat for our housing market.
"The fact that we have seen a bit of momentum lost was to be expected."
Dr Powell said lower supply of homes for sale has helped to put a floor under prices and stem faster or deeper falls of late.
"Sellers sat on the sidelines, they were cautious about selling in a downturn…we didn't see that strong seasonal bounce we usually see in spring," Dr Powell said. "Less properties are being sold and new listings pulled back and that has helped to keep total supply in the market, nationally, quite limited, and that underpins pricing."
The heat has been extinguished from Sydney's downturn, with house prices falling three times slower over the last three months of 2022 than the previous quarter. Units "underperformed" during the pandemic, Domain's report said and, to end 2022, unit prices slid for the fourth consecutive quarter for the first time since 2018.
Prices of houses and units have stabilised in Melbourne. House prices tanked at their fastest ever rate over the previous quarter (the three months to September 2022). The median house prices went up a touch over the December quarter but when observed over 12 months, houses have experienced the deepest decline in three-and-a-half years to scale back to mid-2021 prices. However, they are still 17.2 per cent higher than before the pandemic real estate boom.
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House price dropped in the sunshine capital at their steepest in ten years, joining Canberra and Sydney in a club of cities with the sharpest falls, from peak to trough. However, prices linger 34.4 per cent higher than before the COVID-induced boom. Unit prices clocked their sharpest quarterly fall in almost two years.
Adelaide is unique in the national market because it still riding a price wave. It is the only capital city market to end 2022 with record high house and unit prices, Domain found. However, annual house growth is tracking slower, at a two-year low. Units out performed houses, which can be explained by demand for this type of residence due to housing affordability issues.
House prices fell over the September quarter but in the last three months of 2022, they bounced back to eat up all of the previous reduction. Darwin was the only capital city to not soar to a record median house price during the pandemic, adding comparatively modest gains, but unit prices have suffered, down $100,000 from a 2016 peak.
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House prices in the nation's capital have dived over two consecutive quarters, which is the sharpest annual price decline in the city's history, on par with the situation in Sydney. Like other capitals, house prices in the ACT have returned to 2021 levels but are still 41.2 per cent higher than before the pandemic.
Hobart's housing market is steadying over the shorter term. Over the December quarter prices went up only a touch, compared to the declines seen over the previous six months, but when looked at over the longer term, Hobart has registered its fastest annual house price drop in six years. House prices are back to what they were in late 2021. However, they still sit at a lofty 46.4 per cent higher than before the pandemic.
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