Apartment blocks near the Sydney Harbour Bridge.
Sydney topped the market as the most expensive city to rent in, setting people back $745 per week. Image by Mick Tsikas/AAP PHOTOS
  • housing and urban planning

House prices smash records, wiping out downturn losses

William Ton January 24, 2024

Australia’s housing market has reached record heights, completely rebounding from its losses during the 2022 downturn.

The housing market in all state capital cities rose over the December quarter while capital city unit prices and Canberra rose in the same period, according to Domain’s House Price Report.

Prices have steadily rebounded after the downturn when prices fell for three consecutive quarters following house price peaks in March 2022 and unit prices in December 2021.

A pullback in sellers coming to market in early 2023 sparked the recovery once competition between buyers reached fever pitch by mid-year and that has continued, Domain chief of research and economics Nicola Powell said.

Melbourne housing
 The median house price in Melbourne has increased to

,047,273. Image by Diego Fedele/AAP PHOTOS 

“New listings have risen but demand is still there. We’re still seeing prices rise and they haven’t risen enough to actually stabilise price,” she said.

The threat of affordability, undersupply, higher costs to build and population growth on property prices has been offset by a growing population, migration and tight rental market.

Sydney’s housing market is again leading the surge, posting its fourth consecutive quarter of house and unit growth, a feat not achieved since 2021.

The median house price in the harbour city has peaked at $1,595,310, recovering the entirety of the $147,000 it lost during the 2022 downturn while units recovered to reach $795,994.

It is expected Sydney house prices will surpass $1.6 million over the first quarter of 2024.

It’s a slow and steady recovery for the nation’s second most-populace city, with the median property price in Melbourne increasing by less than one per cent to $1,047,273.

Melbourne’s unit price recovery had a third consecutive quarter of growth, reaching $579,506, the strongest period of persistent growth since the latter part of 2019.

In Brisbane, house prices recorded a full-year of growth, lifting annual gains to the steepest since September 2022. 

Median house prices reached a record high of $888,285, recouping the entirety of the $47,000 value lost during the 2022 downturn.

The city’s unit prices continue to break price records sitting at $524,202, which accounts for the steepest rise of all capitals and at 14.2 per cent is the city’s fastest increase in about 16 years.

Adelaide and Perth had record median house and unit price growth thanks to a combination of a tight rental market, with the latter also benefiting from interstate and overseas migration.

Perth property prices.
 Prices continue to rise for property in Perth. Image by Aaron Bunch/AAP PHOTOS 

Hobart’s housing market is in a price recovery with median house prices sitting at $706,728, recording a positive December quarter after six quarters of consistent declines.

At a median price of $535.426, the island state’s unit prices remains in a volatile recovery phase following a previous quarter of decline.

The nation’s two territories both bucked the house price trend, recording declines in the December quarter.

Darwin’s unit prices have also gone backward, cementing it as the most affordable city to buy a house and a unit. 

Dr Powell predicts property prices will continue to rise over 2024 but be constrained by affordability.

“This is not going to be a boom-time scenario,” she said.

But prospects of stage three tax cuts and the cash rate being cut could dash hopes of a downturn.

“That’s likely to feed into greater levels of activity and and probably see the pace of growth gather momentum towards the latter part of 2024 but certainly as we move into 2025,” Dr Powell said.