AUSTRALIA / RankWire.AI / – Australia’s housing market saw a decrease of $34.1 billion in total value during the June quarter amid a nationwide softening in home prices. The residential property stock in the country declined 0.3%, bringing it to $12.689 trillion. This marks the first quarterly decrease in total dwelling value since September 2022. A forecast of a 10% peak-to-trough price decline would correspond to roughly $1.3 trillion relative to the current national housing stock. These figures highlight the substantial household wealth tied up in Australian residential properties.
According to the Australian Bureau of Statistics, households owned $12.183 trillion worth of residential real estate at the end of June. Australia’s housing stock consisted of 11.531 million dwellings, reflecting an increase of 54,400 homes during the quarter. The average home price decreased by $8,200 to $1.1004 million. Despite the quarterly decline, the total value of Australian residential properties remained 8.5% higher than it was a year earlier. This annual growth followed several years of robust expansion across many capital-city and regional markets.
New South Wales experienced the largest quarterly drop, with a decrease of $92.9 billion in total dwelling value. Victoria’s market saw a decline of $44.3 billion, while the Australian Capital Territory lost $1.4 billion. Conversely, all other states and territories recorded increases in total residential values. Average property prices also fell in New South Wales, Victoria, and the ACT. Nonetheless, New South Wales maintained the highest average dwelling price at $1.305 million, with Queensland coming next at $1.131 million.
National Home Prices Continue Downward Trend
The housing sector’s weakness persisted beyond the June quarter, with national average home prices dropping 0.9% in August, marking the fifth consecutive month of decline. Shane Oliver, chief economist at AMP, noted that prices had fallen 3.6% from their peak by the end of August. His forecast suggests a nationwide decrease of approximately 10% from peak to trough. Applied to the current property market value of about $12.7 trillion, this percentage equates to nearly $1.3 trillion in residential wealth loss.
During 2026, borrowing costs have also increased. The Reserve Bank of Australia has raised the cash rate three times this year, bringing it to 4.35%. These increases total 75 basis points. As a result, mortgage rates adjusted upward, influencing home-loan pricing. Scheduled mortgage payments are approaching their 2024 peak relative to household disposable income. The Reserve Bank’s August assessment also indicated that national housing prices are 1.6% below their March peak.
Sydney and Melbourne Lead in Price Declines
Among Australia’s major markets, Sydney and Melbourne have experienced the most significant recent declines in home prices. Auction clearance rates have fallen below their long-term averages. While Brisbane and Adelaide have experienced softer conditions, Perth and some regional areas continue to see gains. Growth in some stronger markets has slowed, reflecting an uneven housing downturn across cities and regions despite broader national price declines.
These recent downturns follow a substantial increase in Australian property values since the onset of the pandemic. As of the August assessment, national housing prices remain roughly 5% higher than they were a year earlier. They are also approximately 50% above levels recorded at the start of the pandemic. Official dwelling stock figures for September are scheduled for release on December 1. Until then, the latest national property valuation stands at $12.689 trillion for June, including the $34.1 billion quarterly decrease.