Home price growth slowed over 2024 and declined over the quarter ending January as buyers had more choice and faced ongoing affordability challenges. The trend has been even more evident in some areas with the cost of a house falling below $1,000,000 in recent months.
According to PropTrack's January Home Price Index, national home prices decreased by 0.1% compared to December 2024 and 0.3% since October 2024.
Melbourne and Sydney recorded the largest quarterly falls among the capitals with prices now 0.9% and 1.6% lower compared to three months prior respectively. Outside the major cities, regional Victoria was the only area where prices declined during the same period.
The current market trends are in contrast with the record high growth witnessed from 2020-2021 and the steady increase in prices from late 2022 to early 2024.
During the high growth period in 2021, a staggering 418 suburbs joined the million dollar club. While the list continues to expand over time, there are a number of suburbs that have fallen off the list in past year.
| Suburb | State | SA4 region | Current median | Month median was last above or equal to $1 million |
| Briar Hill | VIC | Melbourne - North East | $965,000 | Sep-24 |
| Clarinda | VIC | Melbourne - South East | $978,000 | Jul-24 |
| Dromana | VIC | Mornington Peninsula | $987,250 | Sep-24 |
| Gisborne | VIC | Melbourne - North West | $960,000 | Sep-24 |
| Moss Vale | NSW | Southern Highlands and Shoalhaven | $975,000 | Sep-24 |
| Pearcedale | VIC | Melbourne - South East | $947,500 | May-24 |
| Shoalhaven Heads | NSW | Southern Highlands and Shoalhaven | $978,000 | Sep-24 |
| Wandana Heights | VIC | Geelong | $947,000 | Apr-24 |
| Warrimoo | NSW | Sydney - Outer West and Blue Mountains | $955,000 | Mar-24 |
| Woodend | VIC | Bendigo | $950,000 | Aug-24 |
In the suburbs of Briar Hill, Dromana and Gisborne, median house prices were above or equal to $1 million in September 2024. Since then, they have declined by 3.6%, 1.3% and 4% to $965,000, $987,5000 and $960,000, respectively.
Houses located in Clarinda and Pearcedale in Melbourne also fell below the million dollar mark. The typical price of a house is now $978,000 and $947,500.
Median house prices in the regional NSW suburbs of Moss Vale and Warrimoo were greater than $1 million in September 2024 and in preceding months but have since fallen below $980,000.
Wandana Heights and Woodend exited the million dollar club in the previous year also. Houses are now typically selling for about $950,000.
The majority of these suburbs are located in Melbourne, regional Victoria and regional NSW which aligns with home price trends showing larger declines in these areas.
The decrease of house prices in these suburbs as well as broader price falls in recent months are likely to be driven by the increase in the number of properties for sale.
The softening of demand is another driver.
With home price growth continuing to outpace income growth these past few years, housing affordability has deteriorated, making it more difficult to purchase or upgrade a home.
However, with interest rates expected to decrease in the near term, buyers' borrowing capacities could increase, which may reignite demand. If this occurs, we anticipate a rise in prices, though it will likely be at a slower rate than in recent years.
