Property markets don’t break – they normalise. That’s the message from Mathew Tiller, Head of Research for LJ Hooker, who has released new long-term data aimed at putting recent price falls in context.
Tiller said every property cycle looks different, but history shows one consistent pattern: falling prices are not unusual.
“They are a normal part of the adjustment process and have occurred many times before,” he said.
“The key is to look beyond a single month’s data and understand the broader cycle. Short-term movements can feel dramatic, but the longer-term data provides a much clearer perspective.”
According to the analysis, Australian dwelling values have increased by 952.2 per cent since January 1986. Across 486 monthly observations, values rose in 369 months – around 76 per cent of the time – and fell in 116 months, or roughly 24 per cent.
Over that same period, Australia has been through 27 upswings and 27 downcycles. On average, an upswing has lasted 13.7 months and delivered growth of 11.7 per cent, while the average downcycle has run for 4.3 months and resulted in a 1.6 per cent decline.
“The current market deserves attention, but it does not deserve panic,” Tiller said.
“Some parts of Australia are cooling after a strong run. Others are still being supported by population growth, tight housing supply, limited stock and relative affordability. It does not mean the market is failing but rather adjusting, which is exactly what property markets have always done.”
Tiller pointed to higher interest rates, stretched affordability and proposed changes to property tax settings as the factors shaping today’s market, and cautioned against assuming every location will move the same way.
“Australia is not one property market,” he said.
“Conditions in Sydney are different to Perth. Melbourne is different to Brisbane. Even neighbouring suburbs can perform very differently depending on affordability, housing supply, employment, buyer demand and the type of stock available.”
For buyers, Tiller said a softer market can bring more choice and more time to negotiate, but warned against trying to pick the exact bottom.
“Trying to perfectly time the bottom of the market is incredibly difficult, but by the time it becomes obvious the market has turned, competition has often started to return,” he said.
“The better approach is to focus on buying the right property in the right location at a price that suits your budget and long-term plans.”
For sellers, Tiller said the fundamentals haven’t changed – people still need to move for family, work or lifestyle reasons – but buyer behaviour has.
“In a strong market, buyers often chase prices. In a softer market, vendors need to meet the market,” he said.
“The strongest results usually come from understanding today’s conditions, not chasing yesterday’s prices.”
Tiller said the priority for agents and their clients should be local context rather than national headlines.
“It is important to understand what is driving your local market, to keep a long-term perspective, and to make decisions that suit your own circumstances,” he said.