Australia's Housing Prices Mark Largest Annual Decline Of 5.3%

Australia's housing markets finished the 2022 calendar year on a weaker note, as a national home value index showed a 1.1 percent fall in December, taking the annual drop to 5.3 percent -- the largest since 2008. In a report, the multinational property information provider CoreLogic revealed that the 5.3-per cent drop through 2022 marks the largest calendar-year decline since 2008 when values were down 6.4 percent amid the global financial crisis and successive interest rate rises.

Annual value falls were the most significant in Sydney, which slid 12.1 percent, followed by an 8.1 percent drop in Melbourne. Hobart, the Australian Capital Territory, and Brisbane also recorded an annual decrease. Meanwhile, three capital cities -- Adelaide, Darwin, and Perth -- saw values rise over the year, marking 10.1 percent, 4.3 percent, and 3.6 percent, respectively.

According to the report, despite the downturn across many areas of the country, housing values generally remain 11.7 percent above where they were at the onset of the Covid-19 pandemic.

After lowering the cash rate target to 0.1 per cent in a bid to boost economic recovery, Australia's central bank has launched a spate of consecutive rate hikes since May last year, pushing the rate to a decade-high of 3.1 per cent. Australia's Consumer Price Index is currently running at 7.3 per cent, with the RBA expecting further rate increases to return inflation back to the 2-3 per cent range.