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Property boom losing momentum – Sydney price growth ‘flatlining’

The rate of property price growth in Australia has dropped dramatically in the first three months of the year, new data reveals.

The Domain March Quarterly House Price Report found the combined capital cities median house price growth rate dropped to 0.6 per cent and 1 per cent for units in the March quarter, down from 6.3 per cent and 2.2 per cent in the December quarter.

A two-step market has emerged with Australia’s capital cities growing at multiple speeds, with Brisbane and Adelaide recording the strongest rates of growth while Sydney, Melbourne and Canberra the softest.

Brisbane and Adelaide are the only cities to have record-high unit prices, while Sydney, Melbourne, and Hobart units fell from the record high achieved in the previous quarter.

Domain Chief of Research and Economics Dr Nicola Powell said there was still strength in some of the country’s smaller capital cities.

“House price growth in Melbourne and Canberra is declining, while Sydney’s rate of growth is flatlining after an extreme property boom,” Dr Powell said.

“When paired with increasing supply, these current dynamics will help ease competition between buyers. 

“While we’re seeing cities such as Perth, Brisbane and Adelaide hitting new records with house prices, overall, the Australian property market is on the cooldown after incredible growth in recent years.”

Dr Powell said slowing growth rates were finally making it easier for buyers.

“These latest quarterly statistics could ease some of the pressure particularly for first home buyers, with annual growth being at a 12-month low,” she said.

“While each city’s figures vary, we’re seeing Australia settle into a ‘new normal’, including increased interstate movements, ease of restrictions and return of international workers, which is prompting shifts in the property market.”

Domain Chief Revenue Officer John Foong said the capital city markets were becoming more balanced.

“While the balance between supply and demand is slowly changing and creating great options for buyers, it’s also prompting a change in seller price expectations, with figures such as auction clearance rates experiencing a drop in some cities,” Mr Foong said.

“As we see this latest change play out in our property market, knowing, and adapting to, the shifts in your local area will be key to continuing to drive strong results for your customers.”


Across Sydney, house price growth is flattening out while unit prices have started to fall.

House prices nudged 0.2 per cent higher over the quarter to $1.59 million, the weakest outcome since prices declined in the June quarter of 2020.

This has slowed the annual growth rate to a 12-month low, at 21 per cent.

Unit prices declined 1.2 per cent to $796,524, although they remain 4.8 per cent higher than a year ago.

This is the first quarterly decline since the June quarter of 2020.

Dr Powell said the upswing in Sydney house prices had come to an end.

“Flattened house prices and declining unit prices has made Sydney’s price growth rate one of the most significant slowdowns of all the capital cities,” she said.

“A year ago, house prices were rising 46 times the current pace, and at the same time unit prices were also increasing. 

“This indicates that Sydney’s steepest upswing on record has ended and swinging power back towards buyers creating better purchasing conditions by providing buyers time to contemplate rather than compromise, and ultimately allowing rational decisions to be made.”


Melbourne house prices recorded the first decline since the June quarter of 2020, with a decrease of 0.7 per cent, which slowed the annual growth rate to a 12-month low, at 11.3 per cent. 

Unit prices also declined by 2.2 per cent over the last quarter, marking the steepest negative moderation over a quarter since 2017. 

House prices have grown more than seven times faster than units over the past year, with median house prices at 89 per cent above the median unit price and retaining a record price gap between property types. 

Dr Powell said buyers are now back in control across Melbourne.

“Melbourne’s property market is witnessing more homes being listed for sale than being purchased, continually showcasing greater purchasing power to buyers,” she said

“The availability of homes for sale is building, with the total supply sitting 8 per cent above the five-year March average and continuing to improve buyer choice.”


Brisbane was the fastest-growing capital city market in Australia over the past year, with median house and unit prices hitting new records and resulting in an annual increase of 32.1 per cent and 9.3 per cent respectively. 

Dr Powell said the property boom was likely to continue in Queensland.

“Brisbane has long been waiting for this property boom, showcasing the steepest upswing in 18 years for houses and 14 years for units,” she said.

“The sheer affordability of keeping up with rapid house price gains is proving a barrier for buyers, especially for first home buyers facing spiralling deposit goals and poor interest accrued on savings.

“This has resulted in the number of home loans for owner-occupied first home buyers falling compared to last year.”


Adelaide hit new records, as house prices increased by 3 per cent over the past quarter and unit prices increased 1.3 per cent. 

However, the upswing has lost steam, with quarterly growth about four times slower compared to the previous quarter, indicating affordability constraints affecting buyers.

Dr Powell said rapidly rising house prices and the lure of a sellers’ market are enticing homeowners to sell.

“House prices have grown three times faster over the past year in comparison to units that have created a record price gap, with houses edging close to double the price of a unit,” she said.

“The rapid price escalation will prove to be a financial hurdle and challenge for entry buyers as well as for people looking to upgrade from a unit to a house, particularly against a backdrop of low wages growth and the increased costs of living.”


Perth achieved a significant milestone over the past quarter, with house prices reaching a record high of $622,030, increasing 1.5 per cent for the quarter and 5 per cent annually for the first time since 2014. 

On the other hand, unit prices declined 3.1 per cent over the past quarter and 4.6 per cent annually. 

Dr Powell said Perth has seen an uptick in transactions.

“Perth’s buyer demand is soaring with the volume of properties sold over the March quarter 15 per cent above the five-year average,” she said.

“Easing of Western Australia’s border restriction in early-March could accelerate another wave of new demand, freely allowing an easier relocation from overseas and interstate providing clarity for residents, this could create a population shift, with some residents opting to return home. 

“This is a trend to watch as given the timing, these drivers are unlikely to have made an impact in the March quarter.”


Canberra’s house price growth has come to an abrupt halt, with a decline of 0.9 per cent over the past quarter – the first time house prices have fallen since March 2020. 

Despite this, Canberra still remains the second most expensive capital city to purchase a house, behind Sydney. 

Unit prices are slightly higher compared to the last quarter, up by 0.6 per cent. 

According to Dr Powell, the Canberra market has started to soften.

“Confident sellers are listing their homes for sale while conditions remain strong and prices are close to a peak in Canberra,” she said.

This is helping to shift market conditions, with the total volume of homes for sale improving from the recent multi-year low. 

Dr Powell said auction rates were also trending lower.

“The eased conditions are evident in the Canberra auction market, with it being the busiest March quarter on record, but clearance rates dropping to 79 per cent compared to 85 per cent for the same time last year,” she said.

“This is still an astounding result; however, it shows us that an element of buyer pressure has eased.”


Hobart house prices hit a record high, with an increase of 4.3 per cent over the past quarter.

On the contrary, unit prices fell 2.3 per cent. Despite the record high house prices, quarterly price growth is losing momentum, providing the lowest house price growth since June 2020 and negative growth for units. 

Dr Powell said Hobart continues to see incredible strength in house prices.

“Hobart’s hot property market is continuing as record-breaking house prices have been a persistent feature since mid-2020 but growth is starting to cool after it peaked in 2021,” she said.

“The quarterly growth has been strongest at the entry-price point, suggesting home hunters are trying to seek affordability. 

“Unit prices fell over the quarter following three consecutive quarters of extreme price gains of around 10 per cent each. 

“Despite the drop, this makes Hobart Australia’s third most expensive unit market behind Sydney and Melbourne.”


Darwin house and unit prices fell 1.8 per cent and 0.5 per cent respectively over the past quarter, for the first time since prior to the pandemic.

This is despite producing the strongest rate of annual growth in roughly 17 years and the highest median price since 2015. 

The dip in property prices indicates an element of housing demand throughout the past two years was perhaps temporary. 

Dr Powell said homeowners had reacted sharply to rising prices, as the number of newly listed homes for sale has risen.

“A strong demand for Darwin’s properties can be seen with a high number of homes sold for the time of year,” she said.

“Weakening demand at a time of rising newly advertised homes for sale has resulted in a build-up of supply, 21 per cent higher in March compared to the same time last year. 

“This is creating more options for buyers and ensuring realistic seller price expectations.”

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Rowan Crosby

Rowan Crosby is a senior journalist at Elite Agent specialising in finance and real estate.