Dwelling prices are still rising but the market’s growth momentum appears to be tapering - a good indicator for would-be homebuyers who are looking to get into the market.  

CoreLogic figures show that dwelling prices grew by 1.3% over November, bringing the median value to $698,170. 

Compared to the same month last year, this recent median dwelling value is 22.2% higher.  

CoreLogic research director Tim Lawless said several factors are slowing the overall growth in dwelling prices, which could be a cause of concern for many homebuyers. 

“Virtually every factor that has driven housing values higher has lost some potency over recent months — fixed mortgage rates are rising, higher listings are taking some urgency away from buyers, affordability has become a more substantial barrier to entry and credit is less available,” he said. 

The uptrend in fixed rates, as Mr Lawless said, could act as a disincentive for some buyers.  

“Although fixed rates are rising, variable mortgage rates are less inclined to rise until the cash rate lifts, which is still expected to be more than a year away,” he said. 

“Low mortgage rates will continue to support housing demand, but probably not to the same extent as seen through 2021.” 

Another concern is the expected move by regulators to further tighten credit policies.  

The Australian Prudential Regulation Authority (APRA) has already adjusted the serviceability buffer and its recent framework has called out the growth in house prices as a key indicator of “emerging systemic risks”, pointing to a likely adjustment.  

Still, Mr Lawless believes there are tailwinds that should continue to support the housing market.  

“Although mortgage rates are rising, the cost of debt is likely to remain well below long term averages, continuing to support demand for an extended period of time,” he said. 

“Open international borders, despite the recently announced delay, are also a net positive for housing markets.” 

State-by-state performance 

Not all states and territories are moving in the same direction and at the same pace.  

While overall values have slowed down, two capital cities – Brisbane and Adelaide — managed to stay ahead, maintaining their trajectory in November.  

In fact, Brisbane and Adelaide are the only capital cities who have yet to experience a slowdown, with their monthly gains even reaching new highs over the month. 

The median dwelling price increased by 2.9% to $662,119 in Brisbane and by 2.5% to $558,179 in Adelaide.  

“Relative to the larger cities, housing affordability is less pressing, there have been fewer disruptions from COVID lockdowns and a positive rate of interstate migration is fuelling housing demand,” Mr Lawless said. 

Meanwhile, the bigger markets of Sydney and Melbourne have seen demand more heavily impacted by affordability pressures and lack of interstate and overseas migration.  

Of all capital cities, only Darwin reported a decline in median dwelling value, down by 0.4% to $493,047.